Sep 03 2018

XAUUSD – Ready for correction

XAUUSD:- Weekly chart is predicting that yellow metal has gathered the bullish momentum for taking a decent retracement/correction of about USD205 fall, from $1365 to $1160. The metal seems holding the downward  sloping trend-line support at $1160-70 levels and along with that Gold has also formed a Double candlestick reversal pattern named “Bullish Harami”.  The candlestick pattern, as per psychology says that a confusion is created in that recent steep fall, which is giving an indication that bulls are gathering momentum at lower levels for driving the asset class higher a bit. Fibonacci tool is applied from the peak ( $1365) to trough ($1160), which in turn has given us the retracement ratios – 38.2% at $1238, 50% retracement at $1262 and the 61.8% correction is coming at $1286. Expecting a pullback at somewhere between 38.2% to 50% Fibonacci ratios, which means towards $1240 to $1260. RSI 14 Days is also indicating the signs of recovery/pullback, as the indicator has turned back after reaching below oversold zone (30).