FX.co ★ GOLD: Analysis for August 08, 2013

Overview:

Since our last analysis, Gold has been trading sideways around the price of 1,289.00, we are waiting for a deeper downtrend. I placed Fibonacci expansion levels to find the potential end of the ascendant corrective phase. We are still likely to see testing of the weekly FE level 161.8% at the price of 1,151.00. I saw weak demand on high volume, according to the daily chart, which is the sign that we may see the downtrend continuation. The current situation in (4H) is that Gold has rebounded from FE 161.8% at the price of 1,347.87 (SR zone) on ultra high volume. That is a sign that Gold may continue its downward movement. Since we are in the short-term downtrend and observe weak demand in the daily chart, buying Gold looks very risky and I advise you to watch for selling opportunities.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,287.73

R2: 1,291.57

R3: 1,297.80

Support levels:

S1: 1275.27

S2: 1271.43

S3: 1265.20

Trading recommendation: Operating with metal, be careful with short-term buying and look for selling opportunities. My recommendation for a downward short-term target is 1,151.00.