Gold Responds to Former Congestion
Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0
Commodity Analysis: Gold reacted to the top of the resistance zone mentioned in recent days, retracing most of Tuesday’s advance. One needs to be nimble here when one considers sentiment as indicated by COT. A drop below 1555 could complete 5 waves down from 1697 and give way to a more persistent advance.
Commodity Trading Strategy: If you took the short into 1618 with a stop at 1655 then it’s best to tighten risk to 1620 and target a test of last week’s low since sentiment reversing from an extreme increases the risk of being short. Additional resistance would be former supports at 1626 and 1639 and support is 1576.
LEVELS: 1523 1555 1576 1626 1639 1652
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.