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Gold Stalls at Technical Resistance- Remains Constructive Above 1262

Gold Stalls at Technical Resistance- Remains Constructive Above 1262

Michael Boutros, Strategist

Talking Points

  • Gold long bias at risk below near-term technical resistance
  • Broader trade remains constructive above $1262
  • Event Risk on Tap

Gold Daily

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • Gold rallies into pitchfork resistance- near-term bearish invalidation
  • Interim support $1280 & $1262/68- bullish invalidation
  • Topside resistance breach targets objectives at $1320/21 & $1335 (July HDC)
  • Daily RSI coming into 70-resistance – breach would be bullish
  • Multiple momentum support triggers pending
  • Event Risk Ahead: FOMC Interest Rate Decision on Wednesday

Gold Hourly

Notes: We’ve been tracking the gold trade higher since early in the month with the rally now testing technical resistance just above the $1300-mark. Longs below the upper median-line parallel (blue dashed) are now at risk with medium-term bias remaining weighted to the topside while above the median-line off the November low.

Bottom line: high probability of a pullback here with such a scenario likely to offer more favorable long-entries while above $1262. A break below this level invalidates the long scalp-bias with subsequent support objectives eyed at $1248 & $1237. A breach above the upper median-line parallel keeps the long-bias in play targeting objectives towards the July highs. Caution is warranted heading into mid-next week with the FOMC interest rate on Wednesday likely to fuel added volatility in USD crosses and dollar based assets.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Relevant Data Releases

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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