Gold: Bullish Breakout Ahead
| Jan 13, 2014 07:56AM ET
Gold (13.01.2014) reversed from the very potential support area of $1208-1180 and now trading between minor support and resistance area which will decide the future direction for shot term.
Now gold is trading around $1245 and as we can see on the chart, it is reaching to the minor parallel resistance area at $1254. we have witness a major bull bear fight in this $1217 - $1254 range earlier and it may be more interesting this time. However the upside move was well supported by an triangle breakout as shown in chart. At the same time RSI above 50 mark showing positivity.
On the fundamental side, last week's NFP data came in much weaker than expected. This might force FOMC to rethink before another tapering on the Jauary 29, 2014 meeting. .
Based on above studies, we will prefer to buy gold on a volume breakout above $1254 and we will be looking at $1270 as our 1st target and then probably for $1293. A day close below $1217 will force us to reanalyze the charts.
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