Gold Consolidates as Market Sentiment Turned to Risk-off
GOLD placed at a high of $1,233.26 to hit our take profit at $1,232 on Monday – its highest level since July 26. The bullish moment came after the global stocks slid on rising tensions between Western powers and Saudi Arabia. Besides that, the escalating trade tensions, concerns over slowing global growth, geopolitical tensions and US mid-term election are collectively raising the level of uncertainty in the market, and consequently, extending a support to gold.
Fundamentally, the dollar is gaining momentum on the back of three rate hikes in 2018. The strong negative correlation between dollar and gold is also keeping the gold’s bullish momentum in check.
Gold has completed the bearish retracement at $1,224 and it seems to form a descending triangle pattern on the hourly chart. In that case, we need to be very careful while taking positions. The bearish breakout can extend the sell-off until $1,220. Whereas, the precious metal can stay bullish above $1,224 today. The immediate resistance prevails at $1,229.
Gold – XAU/USD – Trade Idea
Gold has a very strong support near $1.224 today. I will be looking to stay bullish above $1,224 to target $1,229. While selling entry will be preferred below $1,223. Good luck and stay tuned for more updates.
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