FX.co ★ Technical analysis of Gold for May 31, 2016

Gold price held above $1,200 yesterday and bounced towards our first important short-term resistance of $1,215. Price remains inside the bearish channel and as long as we are inside it we can even see it near $1,190-80. I believe a bigger bounce has already started towards $1,250.

Black line - long-term resistance

Blue lines - bearish channel

Gold price is now testing the upper channel boundary at $1,215. Breaking above that area prices could bounce towards the Kumo resistance of $1,240-50. There I would expect prices to get rejected and pull back for a lower low near $1,170.

Gold price has held above the 38% Fibonacci retracement so far. This is an important support. However I believe that the downside correction is far from

the end and we should expect Gold to reach even the 61.8% Fibonacci retracement after a short-term bounce that could last for a week or two.