Buy the dip on gold, anyone?
XAU/USD (GOLD):
For traders who read Thursday’s briefing you may recall the piece highlighted a potential pullback from the H4 resistance level at 1325.4, as it’s housed within the walls of a daily supply zone plotted at 1332.6-1322.3. In addition to this, it was also noted the H4 RSI indicator was (still is) trading within overbought terrain.
Well done to any of our readers who managed to jump aboard this move. The next downside target falls in around daily support at 1307.7. As you can probably see, though, there is a H4 demand sited a few pips north of this level around the 1312.8 neighbourhood which could bounce price. Trade this demand area with caution, as a stop run beneath the zone will likely take shape in order to accumulate liquidity (sell orders) to enter long.
Ultimately, we do not expect the yellow metal to extend much past the aforementioned daily support, owing to the weekly picture’s structure. The candles on this timeframe recently conquered its 2018 yearly opening level at 1302.5, possibly freeing the runway north towards resistance marked at 1357.6.
Areas of consideration:
In the event our analysis proves to be correct, the market will eventually cross swords with daily support highlighted above at 1307.0. This level – coupled with weekly price eyeing levels in the 1350s region and a firm bullish candlestick signal (entry/stop parameters can be taken from this structure) out of the H4 timeframe – is enough evidence to consider a long, targeting the noted daily supply zone as the initial port of call.
For traders who read Thursday’s briefing you may recall the piece highlighted a potential pullback from the H4 resistance level at 1325.4, as it’s housed within the walls of a daily supply zone plotted at 1332.6-1322.3. In addition to this, it was also noted the H4 RSI indicator was (still is) trading within overbought terrain.
Well done to any of our readers who managed to jump aboard this move. The next downside target falls in around daily support at 1307.7. As you can probably see, though, there is a H4 demand sited a few pips north of this level around the 1312.8 neighbourhood which could bounce price. Trade this demand area with caution, as a stop run beneath the zone will likely take shape in order to accumulate liquidity (sell orders) to enter long.
Ultimately, we do not expect the yellow metal to extend much past the aforementioned daily support, owing to the weekly picture’s structure. The candles on this timeframe recently conquered its 2018 yearly opening level at 1302.5, possibly freeing the runway north towards resistance marked at 1357.6.
Areas of consideration:
In the event our analysis proves to be correct, the market will eventually cross swords with daily support highlighted above at 1307.0. This level – coupled with weekly price eyeing levels in the 1350s region and a firm bullish candlestick signal (entry/stop parameters can be taken from this structure) out of the H4 timeframe – is enough evidence to consider a long, targeting the noted daily supply zone as the initial port of call.
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