Oct. 16 – A Potential Trade Setup In Gold!
Arslan Butt • 1 min read
What's up, fellas. Welcome to another exciting week. Last week, the precious metal Gold did really well. As recommended in our update, Happy Friday – A Quick Technical Review of Gold, the Gold exactly hit $1,290 and turned bullish towards $1,300. Buckle up to trade today!
Fundamentally, the Gold prices are trading bullish with tension in the Middle East supporting the demand as Baghdad relocated troops into the oil-rich Kirkuk area. This is where the Kurdish Regional Government has a center. It has encouraged a push for independence opposed by Iraq, Iran, and Turkey. Consequently, the demand for haven assets is boosting.
GOLD // XAUUSD – Quick Technical View
Let's take a look at the daily chart of Gold. We can see, the Gold has broken above the 32.8% Fibonacci Retracement level of $1,297. It was a highly expected breakout and we waited for this in the previous week.
Gold – Daily Chart – 50% Retracement
The way Gold has closed the last week, it seems like the bullish power isn't over yet. We can see a huge bullish single which is engulfing the previous candle. For all the newbies, do check FX Leaders Candlesticks Analysis update in order to understand how these candlestick patterns work.
The immediate resistance is found at $1,308 while the support prevails at $1,299. The RSI and Stochastics are in the overbought region, so we can expect Gold to fall back to $1,299/97 area and that's where to can enter a buying position.
Gold // XAUUSD – Trading Plan
Today, the idea is to stay bullish above $1,298 in order to target $1,305 and $1,308. The stop needs to be below $1,294. Good luck.