Good Afternoon Traders,
Welcome to another article of Gold where we will be taking a look at the next possible move for this market.
First of all it is key to note that the weekly candle has closed as a bullish hammer still in the region to form a new higher low.
Now going down to the daily timeframe below we can see that price over the last week did not show much movement until Friday when we saw price show a strong bullish push. Price had been ranging at the support area of 1286.00 where we saw 3 Spinning tops.
Price on Friday pushed back to the upside where price now sits above the 1295 resistance.
Taking note of our 20 & 50 EMA’s we can see price had broken below both EMA’s however retraced back to close above the 50EMA on Friday.
Price on the Daily timeframe has shown a break of the previous higher low at the area of 1303.00 which is a key area to watch. From here we could see further continuation to the upside however there is one barrier in the way which is 1303.00
Now going down to the 4 Hour Timeframe we can see that price is back at the 4 Hour 50EMA where we can see price formed indecision.
The key area to watch is the area of 1303.00, if we see this area broken then we will expect to see price rally higher to the area of 1315.75.
However if price remains below the area of 1303.00 and continues with the downside momentum, we would need to see a break back below the area of 1295.00 to be able to take a short position.
Overall a break below the 1276.90 support would show much more downside potential with the next support being at 1264.60.
Over the next week we will watch to see how price reacts and whether price pushed back to the area of 1303.00 where we will be watching for the key decision of a break or rejection.
James at Technical FX101