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Gold is currently testing the upper limit of its medium-term bullish channel at 1,717 suggesting a decline. However, a break of these levels will initiate a violent bullish channel.
Technical indicators do not provide clear signals, but until the resistance is not broken the assumption of a decline is most likely. Bollinger bands have stabilized showing a more regular volatility.
Gold is currently testing the upper limit of its channel, we suggest 2 scenarios. The first one is the hypothesis of a decline where we recommend a sell on the level of 1,717 with the 1st objective at 1,707 and then at 1,705. A breakthrough of 1,720 will invalidate this scenario. The second scenario is a break of its resistance where we advise a “buy stop” which means to buy gold as soon as it is broken through its resistance of 1,717 with the 1st objective at 1,727 and then at 1,730. A breakthrough of 1,714 will invalidate this scenario.
