Source: Forex Analysis
As we expected, the gold price has made the new lower low and is showing signs of reversal. Bulls need to break above $1,327 to confirm upward short-term reversal. However, the price remains trapped inside the long-term trading range.
The gold price is testing Ichimoku cloud resistance on the 4 hour chart. The price has reached the area between the 61.8% and 78.6% Fibonacci retracement levels and is bouncing off it. The $1,327 level, if broken, will push price towards the next resistance at $1,337. However the most important levels for the gold traders remain $1,360 and $1,300.
Red lines – trading range
Black line – medium-term support trend line
The gold remains trapped inside the Ichimoku cloud and inside the trading range. There is no clear trend. So far, only swing traders who buy near support and sell near resistance have been profitable. However, I expect to see a break out of this range soon.
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