Gold to reverse lower as rally stalls
Our medium-term bias remains positive although pullbacks are likely. The rally was sold and the dip bought yesterday resulted in little net change.
Although the bulls are in control, the stalling positive momentum indicates a turnaround is possible. The bearish engulfing candles on the hourly chart is negative for short-term sentiment and a lower correction is expected to challenge Friday's Marabuzo level.
Management and risk description
Once the trade is triggered and first target is reached, move stop to entry on balances looking for second target.
Entry: sell XAUUSD on a break of $1,240/oz
Stop: a break above $1,250/oz.
Target: $1,225/oz & $1,200/oz
Time horizon: 1-3 days.
Source: Saxo Bank
— Edited by Martin O'Rourke
Non-independent investment research disclaimer applies. Read more