FX.co ★ Gold analysis for August 05, 2014

Overview:

Since our last analysis, gold has been trading upwards. As we expected, the price tested the level of 1,293.00 in a volume below average according to the 4H timeframe. As you can see from the chart, our Fibonacci retracement 61.8% completed successfully, so selling at this stage looks risky. I have placed Fibonacci expansion to find potential resistance levels and I got Fibonacci expansion 61.8% at the price of 1,296.00, Fibonacci expansion 100% at the price of 1,302.00 and Fibonacci expansion 161.8% at the price of 1,312.00. Anyway, if the price breaks the level of 1,281.00 (our Fibonacci retracement 61.8%), we may see more downward movement. Be careful with selling Gold at this stage.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,294.36

R2: 1,296.58

R3: 1,300.70

Support levels:

S1: 1,287.18

S2: 1,284.96

S3: 1,281.37

Trading recommendations: Be careful with selling Gold at this stage since we got successful bounce from Fibonacci retracement 61.8%