Gold added another $14.5 to close at $1243 for week as the dollar index continued to slump due to political issues mainly generated by America. The incremental gains where quite sharp at the start of the week and led to a breakout in the chart (Gold breaks the trading range), but was slowed down as the higher price was continuously rejected and metal witnessed selloff from the highs of $1253 to close at $1243. On the other hand prices took support at $1241 levels and bounced back in intraday trades suggesting a “push-pull” situation where a conclusive move was missing.
On the chart-
Gold surged ahead in the trading range creating more bullish momentum. The metal was poised for a big upmove since it had broken the trading range in the first half of the week but the momentum subsided in the later half of the week due to selling/shorting seen at higher levels sending the price to close fairly lower when compared to highs it hit in the week. Still gold remains in the upside as it moved higher into the trading range.
Gold is still broadly in bullish grip and is trading well into the range which has a high of $1295 (D) and a low of $1218 (B). The prices are expected to move higher towards $1278 (A) which may be a fair resistance on the chart confirmed by intersecting bullish-bearish ray lines with an outside chance to go even higher towards the $1295 (D) mark if the global sentiments boosts gold prices. Whereas Friday’s bar was bit bearish among the bars created in the whole week but was still showing positive signs as the price took support at $1240 (C) confirmed by intersecting ray-lines which may now act as a short-term support on closing basis. But a breach may result in more downside towards $1218 (B) which is a good support on the chart and this “mark should hold” to keep the bulls in the game.
On larger terms, Gold still remains bullish with the prices expected to go higher with initial targets of $1254 and $1268 for short/medium term and a long term target of $1305. While on the downside the price may test $1218 if $1240 is broken conclusively but the chances are slim for such a move.
Positional trade still remains same, Gold can be bought for possible target of $1254 and $1268 and even higher towards $13o5 which is a key resistance on the chart with a stop loss placed at $1217.
For positions held from $1218 stop loss should be at $1200.