At the beginning of the American session, gold is trading at 1,873, just below the strong resistance of 8/8 of murray located at 1,875. A correction is expected in the next few hours towards the support of 7/8 of murray located at 1,859.
On November 15, the eagle indicator touched the 95-point zone, representing an imminent technical correction. A correction in gold is likely in the next few hours, due to the fact that it is extremely overbought.
As long as gold remains below 1,875, there is a possibility of a correction towards the 21 SMA located at 1,861. The eagle indicator is showing a bearish signal and could favor our technical correction outlook for the next few hours.
Since November 3, gold has settled within an uptrend channel formed on 4-hour charts. It still continues to trade above this channel and is also above the 21 SMA. This favors the possibility that it will continue to rise in the short term to the level of 1,890 (+1/8).
A technical rebound in the area of the 21 SMA around 1,861 will be a good opportunity to buy back gold with targets at 1,875. If this level is surpassed, the price could quickly reach the strong resistance of 1,890.
A consolidation and a break below the uptrend channel could be the start of one of a bearish movement and we could expect a decline until 1,843. If bearish pressure persists, the metal could reach 1,812.50 around the 200 EMA.
Our trading plan for the next few hours is to sell below 1,875 and buy around 1,860. The eagle indicator supports our bearish outlook given that it is showing extremely overbought levels.
Support and Resistance Levels for November 16 - 17, 2021
Resistance (3) 1,890
Resistance (2) 1,883
Resistance (1) 1,876
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Support (1) 1,863
Support (2) 1,855
Support (3) 1,849
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A trading tip for GOLD for November 16 - 17, 2021
Sell below 1,875 (8/8) with take profit at 1,861 (uptrend channel) and stop loss above 1,880.
The material has been provided by InstaForex Company - www.instaforex.com