Last week, the XAU/USD managed to break the level of 1245.00 that coincides with 61,8% Fibonacci level and serves as a powerful resistance line. Afterwards, gold faced a level of 1260.00, which was broken as well. Finally, the pair traded at about 1280.00 at the end of the trading session.
Gold consolidated in a narrow range of 1273.00-1281.00 yesterday, but today it has moved beyond its limits and headed upwards.
Bulls' next target will be a level of 1300.00 but correction to a level of 1260.00 is not excluded and may be used for opening long positions. Technically, indicators are pointing to growth: all moving averages are directed upwards; MACD is in the positive zone and the signal line crosses the histogram; Stochastic both lines are directed upwards.
Support and resistance
The nearest resistance levels are at 1295.00 and 1300.00. Support lines are at 1273,00, 1266.00, 1260.00. Bears' main target is retracing below 1260.00.
Short positions should be opened from a level of 1300.00 and below the levels 1280.00, 1273.00. Long positions should be opened after the price has consolidated above 1300.00 and from the levels 1280.00, 1260.00.
Analyst at LiteForex Investments Limited