On the chart –
Gold may have entered into time correction/consolidation after 6 weeks of vertical upside which is quite normal given the size of the rally. We have 2 scenarios –
1. Gold closed above the support, till this is held it can move till $1406. If this is crossed it can rally till $1412. And if this is taken out it can move towards $1420 and finally $1434.
Short trades still don’t fit into the picture as supports were held and trend remains far too for any counter-trend trade except scalping.
view – Bulls attempted a jab at the highs again but failed to register a new one allowing consolidation to kick in as buying was not visible at the highs. Still they managed a good closing perfectly above the breakout area which suggests buying at the lows as slowdown fears continue to grip the globe even after a successful G20 summit and U.S – China trade talks. For bulls to keep continuing higher they need to defend the supports as well as aim for new highs as technicals and fundamentals are very much favorable for them.
Bearishness remains off the table as broad trend remains ultra .
On larger terms, Gold remains and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1406 for the targets of $1412 and $1420 with a stop loss placed below $1392. Longer term target $1434.
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.