Gold price bounced from the long-term support of $1,282 and is challenging short-term resistance as we expected. Gold price is expected to continue higher this week and I expect a weekly close above $1,300 to signal a bigger upward reversal and the start of a bigger bounce.
Blue line (RSI) - bullish divergence
Red line - short-term resistance
Green lines -targets
Yellow line- medium-term resistance
Gold price remains in a down trend. As long as price is below the red trend line resistance I will be waiting for new lows. However I see this as the less likely scenario, we have to see signs of strength in order to be more confident of our bullish scenario. Such signs will be initially the break above the red line resistance. Yesterday we tested that resistance and got rejected. A higher low today and a higher high will be a bullish sign for the next couple of weeks.
