FX.co ★ Analysis of gold for January 07, 2014

Overview :

Since our last analysis, gold has been trading sideways around the price of 1,214.00. According to the 4H time frame, we can observe demand in an ultra-high volume (buying climax) in the background, which is a sign that buying gold at this stage looks risky. Our Fibonacci retracement 61.8% at the price of 1,211.00 is broken so we may expect testing of the level of 1,237.00 (swing high like resistance). According to the 1H time frame, we can observe bearish harami candle formation, which is a sign of temporally lack of demand. Anyway, my advice is to watch for potential buying opportunities on the lows.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,223.06

R2: 1,228.18

R3: 1,236.47

Support levels:

S1: 1,206.48

S2: 1,201.36

S3: 1,193.07

Trading recommendations: Watch for potential buying opportunities after retracement (buy on the lows).