Gold price has made a double bottom around $1,207-$1,210 and then bounced back above $1,220 towards $1,230. Our longer-term view remains bearish and the upside potential we see is limited to $1,240-50. The trend remains down and we prefer to look for sell opportunities.
Green line = price channel
Blue line = support
Gold price remains inside the downward sloping channel and is testing the Ichimoku cloud resistance. The double bottom at $1,207 area gives me a target of $1,230 that we have already reached in early trading or even $1,240. I expect price to be rejected between $1,230-40 and turn back lower to break $1,207.
Blue line = triangle formation
The trend in the daily chart remains fully bearish. This upward bounce is expected to be short-lived and a resumption of the downtrend to test the lows at $1,180 is expected. I prefer to look for sell opportunities near $1,230-40 or sell on signs of weakness. A sign of weakness would be the break below support level of $1,215 and below $1,207.
The material has been provided by InstaForex Company - www.instaforex.com
