FX.co ★ Strategy of the day on GOLD

Gold is currently testing the upper limit of its medium-term bearish channel at 1,594 suggesting a decline. However, a break of this level 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 are much discarded as a result of a strong increase these days. Stabilization is expected in the short term.
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 1,594 with the 1st objective at 1,584 and then at 1,581. A breakthrough of 1,597 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 1,594 with the 1st objective at 1,604 and then at 1,607. A breakthrough of 1,591 will invalidate this scenario.