Gold's general commentary: According to my calculations, looks like that Tuesday's session sharp pullback had to do with Bond Yields on recovery candles (were struggling to make Bullish comeback) than the minor rise on DX as no other asset correlations validated it (nor Usd-Jpy pair or Stock markets). It is possible though that the market is repeating the Technical pullback that it always does after it hits the Daily chart Neutral Rectangle zone following a market bottom (October #8 - #10 and December #6 - #9), and the current Top’s around #1,848.80 - #1,858.80 Resistance zone. The Daily chart’s RSI points that Gold was closer to the Top on than the Bottom on the Medium-term but like I said on multiple occasions, the key is the Weekly chart’s (#1W) #1,827.80 - #1,817.80 Support zone. As long as mentioned zone holds, Price-action will attract Buyers (Buying the dip) and always push for Resistance test, until one side gets invalidated. Closing the Weekly candle above the Resistance, is Bullish Short-term signal, closing below it the opposite, but Medium-term opportunity. Bulls will dominate above the Daily chart’s #1,851.80 closing, while Bears already took control as market closed below #1,818.80
Technical analysis: Strong rejection on the #1,840.80 February #8 - #10 High following the upswing on DX and Bullish Gap fill on Bond Yields aftermath. The rejection has so far delivered a pullback on both Hourly 1 and Hourly 4 chart Support zone again, zone that in my view plays the role of the Pivot within the #1,818.80 Support and #1,851.80 Resistance. As long as this Resistance holds, the #1,817.80 fractal (February #23 High) is coming strong from below to offer the Support (and rebound point) as it has done so since January #5. However, break of Support zone can extend the decline for more than #40 points within #1 session. Fundamentally, my eyes are on the Bond Yields, aswell in anticipation of a new auction when Treasury is expected to deliver record sale of Bond Yields (#370 billion) that will continue to support the economy in the same fashion since March. Needless to say, that would be Bearish for Gold Long-term. On an Intra-day basis the only Trading opportunity exists below #1,818.80, as I don’t see why I shouldn’t allow additional risk such Selling bias.
My position: I am currently operating with my Selling order (engaged on #1,818.80 break), calling for #1,792.80 Higher Low extension. Since my main market (Bond Yields) are Trading above the Resistance and pierced Q1 High, I am expecting meltdown on Gold and #1,792.80 test within #1 session. I placed my Stop-loss a bit wider since my margin can handle it (as my Yearly Profits are great).
I will use this chance to wish Eid Mubarak to all Traders who celebrate the holiday, enjoy the festivities!