Hello traders! In our previous idea on Gold, we have been talking about the upside target located at $1668. Gold has reached that target and broke above, reaching the $1747 high on April 14.
After that correction down followed, and from what it seems it could be an ABC correctional phase, which is about to end. Besides, XAU/USD is trading right at the previously suggested upside target, which now is acting as the support.
We can see that $1660-1675 is an area of strong support, where price could stay for some time, during a short term range-trading. We should also pay attention to the 200 Exponential Moving AVerage, where price could be heading in the short term. This is actually $1643 which corresponds to the 76.4% Fibonacci retracement level.
All in all, the short term picture could be quite dirty, while the consolidation phase is on. But in the longer-term price still looks very bullish. In order for Gold to confirm the uptrend, the price must break a $1703 resistance level. This should trigger yet another wave up, towards either $1735 or $1807 resistance levels.
On the downside, 4h break and close below $1663 support could push the price towards $1643, where 200 EMA will be located. But, if $1643 is broken, with the daily close below, then it might confirm that Gold is about to correct much deeper. The next target is seen at $16.7, which is 61.8% Fibs. And the one after that is at $1577, which is 50% Fibs.
Bias: Potential range-trading between $1660 and $1700
Potential Upside Targets: 1703, 1735, 1807
Potential Downside Targets: 1663, 1643, 1607, 1577
Have a profitable trading!