FX.co ★ GOLD Intraday Technical Analysis

Gold broke the intermediate resistance of its medium term bullish channel leading to acceleration to the upper limit of its channel at 1,678 suggesting a decline. However, a break of these levels will allow it to release a large potential and initiate a more violent bullish channel.
Technical indicators provide sell signals and evolve in overbuy zone supporting the hypothesis of a decline and until the resistance is not broken, the assumption of a decline is most likely. Bollinger bands are much discarded as a result of a strong increase these days. Stabilization is expected in a short term.
As gold tests the upper limit of its channel, we recommend 2 scenarios: the first one is the hypothesis of a decline where we suggest a sell on the level of 1,678 with the 1st objective at 1,665 and then at 1,660. A breakthrough of 1,681 will invalidate this scenario. The second scenario is the hypothesis of a break of its resistance where we advise a “buy stop”. We recommend to buy the gold as soon as it is broken through its resistance of 1,678 with the 1st objective at 1,688 and then at 1,690. A breakthrough of 1,675 will invalidate this scenario.