XAU/USD: Gold is overbought on February 04, 2016

February 4, 2016

The price of gold has returned to the level of 1190.00 USD per troy ounce, (which is had at the beginning of November), regaining half of the losses since mid-October 2015. On the daily chart the price has broken down strong resistance levels 1129.00 (ÅÌÀ200), 1132.00 (upper line of the upward channel) and 1135.00 (Fibonacci 61.8%).

On the weekly chart the price is rising to the upper line of the downward channel. The indicators OsMA and Stochastic recommend long positions, although the price has faced resistance at the level of 1140.00 (ÅÌÀ50).

On the four-hour chart the indicators are in the overbought zone. Nevertheless, current fundamental data puts pressure on the USD, triggering the rise in price of gold.

Sell positions are recommended if the price goes back below the level of 1129.00 (ÅÌÀ200 on the daily chart). It is advisable not to open buy positions due to overbought factor, or place short-term buy orders with the view of the lower timeframes.

Support levels: 1135.00, 1132.00, 1129.00 and 1120.001115.00.
Resistance levels: 1140.00, 1150.00 and 1155.00.

Trading tips

Sell Stop: 1138.00. Stop-Loss: 1146.00. Targets: 1135.00, 1132.00, 1129.00, 1120.00 and 1115.00.
Buy Stop: 1148.00. Stop-Loss: 1140.00. Targets: 1150.00, 1155.00 and 1171.00.

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