Technical outlook:
Gold rose through $1,879 highs during the Asian session on Monday before reversing sharply. The precious metal dropped through $1,852 lows intraday and is seen trading around the $1,855 mark at this point in writing. Bulls will be now poised to hold prices above $1,825 intermediate support carved on Friday.
Gold has carved a lower degree upswing between $1,825 and $1,879 over the previous week. The price is retracing the above boundary and is expected to find support around the $1,840-45 mark, in line with the Fibonacci 0.18 retracement of the above rally. Ideally, the rally should resume thereafter, pushing through the $1,920 mark.
Gold is now working on a larger degree downswing between $1,998 and $1,786 levels. The metal is in a corrective rally, which is into its last leg against the $1,825 level, expected to terminate through $1,920 going forward. In addition, the $1,920 level is the Fibonacci 0.618 retracement of the above larger degree downswing. Watch out for a bearish reversal thereafter.
Trading plan:
Potential rally through $1,920 against $1,781
Good luck!
