FX.co ★ GOLD analysis for February 04, 2014

Overview:

Since our last analysis, gold has been trading upwards. The price rejected from our corrective FE 161.8% at 1,266.00 and tested the level of 1,252.20 on high volume. If the price breaks the level of 1,238.00 on higher volume, we may see the testing of the level of 1.222.00 (FE 161.8%). Anyway, if the price breaks the area of 1,266.00 on higher volume, we may expect further bullish movement and continuation of the bullish corrective phase. We can observe large buying climax at the price of 1,264.7 which is a sign that buying gold at this stage looks risky. Buying gold looks risky since we are in short- and mid-termdown trend, and we can also observe the finish of the major ABCD bullish corrective phase.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,265.14

R2: 1,271.16

R3: 1,280.90

Support levels:

S1: 1,245.66

S2: 1,239.64

S3: 1,229.90

Trading recommendation: Trading the metal, be careful with buying and try to catch the bearish continuation phase if the price breaks the area of 1.238.00