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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Gold breaking higher as the bulls go on a run

Trading outlook:
We are increasingly bullish on gold now as the breakout comes with strengthening momentum. The move comes with upside potential and a breakout above $1611 would be another key move. Support levels are strengthening and near term weakness is a chance to buy.

 

Support
  • $1591 – 3rd February high
  • $1578 – 13th and 14th February highs, 17th February low
  • $1571 – intraday low 13th February
Resistance 
  • $1611 – 8th January high
  • $1620 – February 2013 reaction high
  • $1628 – Ultra long term 23.6% Fibonacci retracement of $681/$1920

 

Technical Analysis:

Breaking above $1577 we turned more positive on gold, but with the decisive move above $1591 resistance, we have increasing conviction. Yesterday’s closing level of $1601 was the highest close on gold since 2013 and brings the January spike high of $1611 right into focus. Our confidence levels are increased further looking at the strengthening momentum, with the RSI into the high 60s, a bull cross on MACD and Stochastics bullish into the 80s. We continue to see intraday weakness as a chance to buy and there is now a good band of support $1577/$1591. The two month uptrend comes in at $1571 today. The hourly chart shows a basis of consolidation early today, but the bulls are well-positioned to buy into weakness.

 

Richard Perry

Richard Perry

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