Gold -0.21% was rangebound and consolidating after a large weekly green bar. It moved between the support and the resistance before finally settling above the crucial $1200 mark for the week. Metal seems to have found some footing at $1198 which is a very important level for the price to take a direction. There was rejection at the highs but it also got support at the lows indicating that fresh bout of buying is happening at lower levels now indicating $1194-$1198 as a demand zone . Another bullish takeaway is it has formed a higher-high and a higher-low after many weeks.
On the chart –
Gold -0.21% held on to the $1200 level after giving back a very modest $4 in the rangebound week. With supports acting as a strong base, Gold -0.21% can restart afresh on the upside again. We have 2 scenarios –
1. Gold’s holding of $1200 is a strong call for further upmove. Till this is held it can rise towards $1208. If this is crossed it can rally till $1217. If this is taken out it can go till $1228.
2. Shorting is still not viable enough as $1200 was held upon again. They become active once $1185 is taken out.
Bullish view – Bulls had another week in their favor irrespective of the loss which the metal posted. New highs were achieved and the next resistance level tested. The pattern of higher-highs and higher-lows is another factor aiding the bulls. As $1200 was held, chances remain high that the metal will move higher.
Bearishness still doesn’t entice as the supports are being held.
On larger terms, Gold -0.21% still remains cautiously bullish and prices are expected to head higher.
Possible trades are on both sides, gold -0.21% can be bought above $1204 for the targets of $1208 and $1217 with a stop loss placed below $1198. Longer term target $1228.
Short trades are against the trend and not a good choice, they only open up as a scalping trade till $1185 is held.
Reference: Trading View
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