On the chart –
Gold continued to break through resistances as it registered a high of $1439 but failed to hold on to big gains. The close above $1400 after 6 years does show the strength and continuation of the trend. We have 2 scenarios –
1. Gold closed above the support, till this is held it can move to $1420. If this is crossed it can rally till $1434.
trades do gain some interest due to the outcome of the G20 summit and U.S – China meet but again it is only limited to scalping as the broad trend has turned ultra given the breakouts.
view – Bulls charged ahead claiming the important level of $1434, though failed to hold on to the gains still they managed a closing above $1400 after good 6 years which itself is a big achievement. Dampening factors include the lowering of global tensions due to U.S – China meet and G20 summit and the respect of the red line again. For bulls to keep going higher they need to protect the supports and continue to create new highs.
Bearishness continues to remain off the table given the breakout gold had on the upside.
On larger terms, Gold continues to remain and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1412 for the targets of $1420 and $1434 with a stop loss placed below $1392.
Dips towards support (and breakout region) can be used to create longs for the above mentioned targets.
Shorts can be useful for scalp trades only.