Gold Signal Hits Take Profit – Brace yourself for Next Trade
Arslan Butt • 1 min read
Gold prices are nearly steady in the Asian trading on Friday and holding around-daily lows of $1,407. Some profit-taking by intraday traders was expected, which is why we suggested staying bearish on gold on Thursday.
GOLD has already completed the 61.8% Fibonacci retracement at $1,404 on the release of the positive inflation rate. The consumer price index expanded 0.1% in June, while the hike in the cost of living over the past 12 months slid to four-month low 1.6% from 1.8%.
However, traders continue to keep a bullish bias on the back of the Fed rate cut sentiments and weakness in the dollar. On Thursday, the dollar index slipped to a five-day low after Federal Reserve Chair Jerome Powell retained the gate open for US interest rate cuts, though traders were wary of selling dollars aggressively until a policy review later this month.
On the technical front, gold is forming a bullish setup after completing 61.8% retracement. It has recently tested the 50 and 100 periods EMA at $1,404 trading level. Interestingly, the 2-hour timeframe is also showing a series of three bullish candles which in technical terms are known as “three white soldiers”.
Gold continues its bullish trend until $1,412 initially and then the next resistance can be seen around $1,418. On the lower side, the violation of $1,404 can extend the selling trend towards $1,398 and $1,390 today.
XAU/USD – Gold – Trade Signal
We have opened a forex trading signal to stay bullish above $1,409 with a stop loss below $1,406 and take profit of around $1,412. You can hold the position until $1,418 with a breakeven stop loss if you like.