Gold technical analysis for February 3, 2016

Gold price climbed to a new high yesterday, but momentum indicators did not follow. I believe we are near an at least short-term top. This will be confirmed once we breakout below $1,120.

Blue lines - short-term bullish channel

Black lines - medium-term bullish channel.

The price is above the Ichimoku cloud support which is found at $1,116. Channel support is found at $1,120. As long as the price is above these levels, a trend will remain bullish. However, the price formation combined with the oscillator overbought levels makes me believe we should exit longs and wait for a downward move.

On a weekly basis, the gold price remains inside a long-term black downward sloping wedge below the Ichimoku cloud, but it has broken above the weekly kijun-sen resistance (yellow line indicator). However, we should wait to see if this week closes above the kijun-sen. Strong weekly resistance is found at $1,150, so this level cannot be ruled out for a final upward move.The material has been provided by InstaForex Company - www.instaforex.com