Gold has fallen down the charts as of late, as the strength of the USD shifts it lower and lower. Following this has been stronger US data and the prospect of interest rate rises sooner, rather than later.
Currently it’s a bearish trend that dominates gold, and the trend is certainly your friend in this case. However, things are held up at $1200.00 and markets will be looking for further lows tonight. The possibility of which is strong given the amount of data due out tonight from Europe and the USA.
Traders looking to trade gold should pay attention to two key regions. The trend line which is likely to act as dynamic resistance (don’t try and fight this) and the solid support levels you’ll find at 1200, 1196 and 1180.
Targeting lower lows is probably the key for tonight, but if there is a pullback upwards, then certainly entering into a short position at the trend line becomes quite attractive. When looking lower expect strong support unless we see some really positive data.
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