Gold at Critical Technical level

The precious metal has since corrected to critical support level bulls (click here to view the previous report projecting this).

Technical analysis profile:

The breakout in the symmetric triangle and a final break above key technical resistance zone $1,161.98 – $1,170.49 makes our short term resistance projection for profit taking and expected short term corrective wave at zone $1,187.12 - $1,192.50. This zone is a Fibonacci confluence zone, $1,187.12  is a 116.2% Fibonacci extension (profit taking level) of the impulse wave $1,072.09 low and $1,171.08 high while $1,192.50 is 75% Fibonacci retracement point of the downtrend $1,072.09 low and $1,232.30 high.

In the near term, correction is expected to the downside towards support zone $1,161.98 – $1,170.49 to give the bulls opportunity to re-enter another impulse wave.

Sentiment:

As long as price action trend above the long and short term moving average bias remain in the upside, we consider renew bullish entry upon a bullish daily candle close above the support level. On the other hand a breach below this support at the end of the trading day, changes our sentiment to bearish.

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