Cheers! The Gold finally hit our recommended target level. Let us recall our previous report entitled Massive Volatility, What’s Wrong? – April 7th Morning Brief. As per our report, the Gold was expected to target $1268 & 1280 above $1260 and it soared sharply to place a high of $1279.66.
Geopolitical Tensions & Their Impact On Gold
Over the previous week, tensions have been rising between the United States and Russia over Syria, particularly after the U.S launched missiles into Syria. According to recent reports, the U.S blames Russia for supporting Syria's chemical attacks and demanded Russia stop its support of Bashar al-Assad, the president of Syria.
Additionally, as discussed in the morning brief, things reached critical mass when the United States chose to move a Navy strike group towards the Korean peninsula. The spokesman of North Korea remarked that they will defend their country by "a powerful force of arms".
Undoubtedly, the geopolitical tensions are affecting the haven assets and investors are losing confidence in the stock markets.
Gold – Hourly Chart
Technical Outlook – Intraday
Due to early morning gains in the yellow metal Gold, it has entered into the overbought territory. It soared higher and failed to surpass the strong resistance level of $1280. Therefore, it is consolidating around $1274, and below a $1280 trading level.
In the hourly chart, we can see that the RSI is crossing below 70, demonstrating that sellers have entered the market for the sake of buying up the retracement. The test bar on the right, below $1280 is another signal of a bearish bias in the metal.
Now the Gold is likely to trade lower to complete 23.6% retracement at $1271 and 38.2% retracement at $1267.
Forex Trading Signal
Considering the above technicals, we have recommended selling at $1274 with a stop loss at $1278 along with a take profit at $1268.
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