Black Pipper

Forex Dreamers

Gold: Cut initial gains in maximum of several years, update daily minimums

The gold extended its steady retreat from highs of several years and now has dropped to the lower end of its range daily trading around the 61.8% level of Fibonacci from rising from lows of night swing. The overbought conditions in the daily chart seemed to have caused aggressive long-term trade amidst a radical change in the day-to-day feeling of global risk.

Some tracking weakness below the $ 1572 level could now be seen as a key trigger for bearish traders and put additional downward pressure on the back of the demand for safe shelter. Gold could then accelerate the corrective fall to the $ 1564 strong horizontal zone test before finally falling to its next main support near the $ 1557 region.

On the other hand, the $1580-82 region (50% Fibonacci level) now seems to act as an immediate resistance, above which the bulls are likely to aim to claim the mark of the $ 1600 round figure. Prior to the aforementioned level (about 23.6% Fibonacci), intermediate resistance levels are linked near the $ 1589 area (38.2% of Fibo) and the $ 1594 region.

Technical Levels

S1 1560.52
S2 1549.24
S3 1542.88

R1 1578.16
R2 1584.52
R3 1595.80

 

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