Gold Outlook: Reversal pattern is forming on daily chart but 20SMA limits recovery

Slobodan Drvenica Windsor Brokers

GOLD

Spot gold regained traction and bounced from Asian low at $1277, as renewed risk-off mode on IMF downgrade of global growth forecast increased safe-haven demand. Fresh gains struggle to return above rising 20SMA ($1284), close above which is needed to complete Doji reversal pattern on daily chart and shift near-term focus towards $1287 (10SMA) and $1292 (Friday's high). Flat momentum and slow stochastic on daily chart obstruct recovery for now and the downside would remain vulnerable on today's repeated close below 20SMA. This would keep pivotal supports at $1276/73 (Monday's low / Fibo 38.2% of $1232/$1298 upleg) exposed, with stronger bearish signal to be expected on break here.

Res: 1284; 1287; 1292; 1295
Sup: 1281; 1276; 1273; 1265

Interested in Gold technicals? Check out the key levels

1. R3 1288.85
2. R2 1286.24
3. R1 1281.12
PP 1278.51
1. S1 1273.39
2. S2 1270.78
3. S3 1265.66

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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