Gold Prices Skyrocketed this Week – How to Trade Onward?

Gold has formed "Three White Soldiers " which is a strong bullish signal, however, the market usually retrace back before the continuation.

Arslan Butt•Thursday, January 31, 2019•1 min read

As we all know, there’s been a massive buying in gold which led its prices near eight-month highs $1,323. The buying was triggered by the sudden weakness in the dollar. The US central bank decided to keep the interest rates on hold but discarded vows of “further gradual increases” in interest rates.

As a result, the traders triggered massive buying in the yellow metal gold along with a sell-off in the dollar. Fortunately, we were able to close our position at take profit before the news release. However, there might be traders who are stuck in an anti-trend trade. If you are one of them, this update is for you.

Gold – XAU/USD – Quick Technical Outlook

Let’s us break down the technical analysis to make it easy for you.

Gold has formed “Three White Soldiers ” which is a strong bullish signal. However, the market usually retrace back before the continuation of bullish momentum.
The leading indicators such as RSI and Stochastics are holding above 80. So, it’s quite possible that buyers will trigger profit-taking below $1,323 today.
Gold is facing a solid resistance near $1,323 trading level. In order to predict the next move, it’s very important to see gold closing today and tomorrow.

The odds of selling will increase if a candle closes below $1,323 on the 4- hour timeframe.
On the lower side, gold can gain support near $1,307 along with resistance at $1,324. Whereas, the bullish breakout at $1,324 can expose gold prices towards $1,360.

Good luck!

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.