FX.co ★ Gold analysis for August 22, 2014

Overview:

Since our last analysis, gold has been trading downwards. Just like we expected, the price tested the level of 1,272.90 in a very high volume. We got successful rejection from our Fibonacci retracement 61.8%, which caused the price to start downward movement. Our Fibonacci expansion 61.8% at the price of 1,284.00 is broken. So, we may see potential testing the level of 1,260.00 (Fibonacci expansion 100%). We can observe very weak demand according to the 4H timeframe, which is a sign that buying looks very risky. Watch for potential selling opportunities afer retracement.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,277.71

R2: 1,277.93

R3: 1,278.27

Support levels:

S1: 1,277.03

S2: 1,276.81

S3: 1,276.47

Trading recommendations: Buying Gold looks risky since the price has broken support level.