Gold launch to resistance under fiery situation
Gold prices up on buying spree since the beginning of September and the prices move past Nov’16 high. However, the situation quickly turns sour as the bear come back into the market and push gold prices back to its opening level by mid of September. The selling pressure is strong and might lead the precious metal back near $1,300 level.
North Korea issue is the main topic at the start of the month and later followed by U.S job data which missed consensus. After the job data, U.S data continue come below expectation, and the most recent data is inflation data. Accompanying the downbeat result, President Trump reign is under test by two fierce hurricanes named Irma and Harvey. While this article was written, there is hurricane Jose which predicted will bring the storm to the Bahamas.
Latest development seems opening path for U.S dollar index bounce following new fresh yearly low printed by the index. Overall, gold is bullish for short-term but might come under pressure in the second-half of September.
Click here to see Gold August 2017 forecast.
Gold on the monthly chart letting out steam and the price returned to opening level. Fortunately, there is strong bullish close in the previous month above $1,300, and any downward movement will meet support level at $1,280 – $1,300. Traders could look for the long position if the price manages to hit the support level.
The weakness of gold on the weekly chart is more apparent as the price fall below previous week low. On the downside, we could observe blue area above the blue trend line for demand or support level. This level previously broken upside by bullish candlestick and major bullish trader who buy gold might defend prices above the candlestick.
Zooming on the daily chart, gold has two trigger candlestick near the resistance level. The first trigger candlestick is the first candle to surpass $1,300. The second candlestick is re-entry buy bull traders who see $1,300 as buying level. Traders could watch $1,313 as the first level to buy as it is the bullish engulfing middle level. If the bear pushes the price lower, $1,300 is the level to consider for another long position.
Bullish trade – A long position could be taken at $1,313 and $1,300 when there is a bullish reaction in the lower time frame chart.
Bearish trade – A short position might need to wait for long-term, at the current situation a short position is a counter trend and must be treated as a short-term trade.