An outbreak of hostilities could push gold towards the resistance zone of +2/8 Murray at 1,906 and consequently cause Wall Street stocks to plunge further.
Gold as a safe-haven asset has strengthened in recent days. Investors quickly moved away from high yield assets and global indices fell rapidly.
According to the daily chart, gold maintains its bullish stance. However, it is showing overbought levels. In the next few hours, there is likely to be a technical correction towards the support level of 7/8 Murray at 1,858, and then the price could resume its upward move.
The eagle indicator has reached the 95-point zone, which represents extreme overbought. A technical correction is likely in the next few hours as long as gold remains below 1,875.
The market sentiment report shows that there are 66.17% of traders who are buying gold. This is a negative signal in the medium term, but in the short term the upward movement could continue. So, we must wait for a technical correction to the support level of 1,830 to resume call options.
Our trading plan for the next few hours is to wait for gold to consolidate below 1,875 to sell, with targets towards 1,859 and up to 1,828 (21 SMA).
Support and Resistance Levels for February 15 - 16, 2022
Resistance (3) 1,902
Resistance (2) 1,888
Resistance (1) 1,879
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Support (1) 1,865
Support (2) 1,856
Support (3) 1,843
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Scenario
Timeframe Daily
Recommendation: sell if it pullback
Entry Point 1,875
Take Profit 1,859, 1843, 1,828
Stop Loss 1,882
Murray Levels 1,875 (8/8), 1,859(7/8), 1,843 (6/8), 1,828 (5/8)
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