FX.co ★ Analysis of gold for January 09, 2014

Overview :

Since our last analysis, gold has been trading upwards. As we expected, the price tested the level of 1,218.27 in a high volume. According to the 4H time frame, we can observe that strong demand has entered the market, which is a sign that selling gold at this stage looks risky. I have placed Fibonacci retracement to find potential support levels and I got Fibonacci retracement 38.2% at the price of 1,201.00 and Fibonacci retracement 61.8% at the price of 1,189.00. Be careful when selling gold and watch for potential buying opportunities on the lows. Yesterday we got weak supply, which casued price to start with upward movement.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,214.64

R2: 1,217.62

R3: 1,222.43

Support levels:

S1: 1,205.02

S2: 1,202.04

S3: 1,197.23

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