Gold price bounced strongly on Friday only to reach the first important short-term resistance of the 61.8% retracement of the decline from recent highs. The price is pulling back down and it is important for bulls to hold above $1,252 in order to resume the uptrend towards $1,330.
As shown on the chart above, gold price reached the 61.8% retracement of the decline and got rejected. Short-term support is at $1,270 and next at $1,263. Resistance is at $1,285. A break above $1,285 will be a bullish signal that will put the previous highs at $1,307 to the test.
Red lines = horizontal support levels
Gold price has made a considerable bounce last week after reaching the 38% retracement of the rise from $1,160 to $1,307. Holding above it will be a bullish sign. Breaking below the 38% retracement will be a sell signal with target $1,220. Making a higher low around $1,270 and then breaking above $1,285 will be a buy signal with $1,330 target.
The material has been provided by InstaForex Company - www.instaforex.com
