Overview:- From past couple of days we are witnessing the tug of war between bulls and bears where bulls were trying their best to take it upside whereas bears are trying their best to take the pair at downside. Well the way both are fighting it seems like bulls are going to win this battle as momentum is already favoring them and short term to intermediate term trend is up so in an uptrend market always buy on dips which will be profitable strategy.
Yesterday we have seen panic buying in the pair and it moved up from $1954 to $1974 today at the time of writing.The aggressive traders may go for buy but for a very near term target of $1800 and $1820 only. Gold is looking strong on the daily along with 4 hourly chart. The way bulls are reacting it seems like they are approaching the $1850 level and we may see further confirmation above the $1800 level.
Technical Analysis: – From technical prospective we can see an inverted head and shoulder pattern is in process of formation on 4 hourly chart and on daily chart potential double bottom pattern is in process of formation which is providing us bullish signal and above $1800 level bulls will get more aggressive. The yellow meta is trading and sustaining above all the major and minor EMA lines on the daily chart and providing us bullish signal for the time being. A bullish crossover on the MACD indicator is still favoring the bulls on daily chart which is pushing us to have bullish view on the gold. Odds are in favor of bulls and daily to weekly bias remains bullish on gold as long as $1750 level remains intact. The way gold is trading and moving on the daily chart it seems like $1900and $2000 level is unfinished target of bulls on long term basis.
What next:- The bulls are dominating the bears leading in the game and playing at front foot and it seems like bull are going to continue with this game and will dominate the bears in near term with full of pace and they are approaching the at $1850 level in coming weeks. The $1900 is make or break level can be considered as key resistance level followed by $2000 where $1750 is a key resistance level followed by $1720 level. Trade idea:- Based on the chart and study above we would suggest that go for buy at $1770-60 for target of $1830 and $1900 level with strict stop loss of $1740 level.
