We’ve been discussing a long Gold setup in our technical analysis pieces with eyes on catching a deeper retracement before triggering the top-side position. In our last article, we looked at RSI divergence showing the potential for a deeper retracement. Price action worked on a support base around the $1,330 level throughout the week, and now Gold has begun to breakout on varying news reports around a coup taking place in Turkey. Given the extreme geopolitical risk being seen of late, the long Gold trade could get some continued top-side run, and we're triggering the position ahead of the weekend close.
The position can be opened at market with stops set to approximately $1,318 in order to get risk levels below the prior price action swing-low. Targets can be set to $1,359.41, followed by $1,375.04, and should Target 2 be met quickly, a tertiary target can be cast towards new highs at the psychological level of $1,400.
Created with Marketscope/Trading Station II; prepared by James Stanley
--- Written by James Stanley, Analyst for DailyFX.com
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