FX.co ★ GOLD: analysis for January 10, 2014

Overview:

Since our last analysis, gold has been trading upwards, as we expected, the price tested the level of 1,237.37 on average volume. The price rejected successfully from our SR zone at 1,219.00. We can also В observe that strong demand entereted market at 1,223.00, which is a sign that selling at this stage looks risky. I placed Fibonacci levels to find potential upper station and I got FE 61.8% at 1,256.00 and FR 38.2% at 1,279.00-1,295.00.Anyway, the first upper station may be at area of previous swing high (1,247.00). In case the price breaks the area of 1,216.00, we may see testing of FR 61.8% atprice 1,207.50. Do not forget, gold is in bearish trend and we are now in bullish corrective phase. Selling gold at this stage looks risky since gold is in progress of bullish corrective phase.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,230.23

R2: 1,232.00

R3: 1,234.87

Support levels:

S1: 1,224.50

S2: 1,222.73 В 

S3: 1,219.87

Trading recommendation: Trading the metal, be careful with selling gold and try to catch bullish corrective phase.