FX.co ★ Gold: Could We Have Bulls Action Soon?

Gold drops but the bloodless movement could attract the buyers into the market again. The price stands at $1,918 level so it could come back higher anytime again as long it stays above $1,900 critical support level.

The risk-off sentiment drove the lower down in the short term but the uptrend is unharmed, a strong bullish momentum around the current levels can restore the shine of gold. Gold is trading within a minor down channel, an upside breakout will conduct to a long opportunity.

XAU/USD support stands at $1,900 level and at the uptrend line, a false breakdown with a huge separation or any other reversal pattern will turn the rate to the upside. The confluence area formed between the uptrend line with the $1,900 level is seen as a strong support area.

A valid breakdown through this confluence area suggests selling, while a false breakdown followed by a bullish momentum signal another bullish run.

• GOLD Trading Tips

Near-term downtrend line breakout will bring a buying opportunity. $2,075 all-time highs remains an attractive target.

Sell a valid breakdown (close and retest) below the uptrend line and under $1,900 psychological level. The downside target stands at $1,800 level.