- July 22, 2020
- Posted by: cabana-admin
- Category: Forex Broker
Overview:- From past couple of weeks we are witnessing a range bound move of 1790 to 1820 level and most of the positional traders were got frustrated in these choppy sessions. We also written in our previous report that breakout on either side will give us new buy or sell signal, so yesterday we got a bullish breakout of 1820 level and bulls reacted aggressively. Bulls arrived at 1865.67 today in the morning session and today at the time of writing bulls are trading at 1856 level.
Yesterday bulls did their best to came out from the consolidation phase, bulls breached out the resistance of $1820 already and now $1870 is yet to break today. The way bulls are reacting it seems like they are approaching the $1900 level in the near term. On the contrary if gold trades and settles below the $1820 level then we may see selling pressure till $1790-1770 level support zone.
Fundamental Analysis:- Investors increased their open interest positions for the fourth consecutive session on Tuesday, this time by around 11.3K contracts according to flash figures from CME Group. Volume followed suit, reaching the second build in a row, now by around 114.6K contracts.
In a week where vaccines have dominated the headlines, the world’s stock markets have push past some resistance levels to keep the risk-on theme ticking over. This comes while the US continues to struggle with the coronavirus pandemic and have had consecutive days of record case counts.
Technical Analysis: – From a technical perspective we can see that a bullish flag pattern on the hourly chart is providing us a bullish signal. Overall it is trading above all the major and minor EMA lines and favoring the bulls. An uptrend line is also lying on the daily chart which is providing strength to the bulls. We will keep our view bullish on the gold as long as this line remains intact.
RSI has arrived above70 level and providing full strength to bulls, so some correction can’t be ruled out but these corrections should be taken as buying opportunity. Odds are in favor of bulls and daily to weekly bias remains bullish on gold as long as $1800 level remains intact on a closing basis. A bullish crossover on the MACD is also supporting the bulls on the daily chart. Also, bulls are playing at the front foot for the time being and it seems like bulls are going to continue with this game and will not provide any chance to bears. The $1820 level can be considered as a key support level followed by $1790 where $1890 is a key resistance level followed by $1920 level.
Trade idea:- Based on the chart and study above we would suggest that traders may go for buy at the current level of $1858-52 for target of $1890 and $1920 level with strict stop loss of $1790 level on closing basis.
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