Analyzing the gold 4 hour chart, I see three possible support zones that bears will need to break to sustain any downside pressure.
1) Confluence of support consisting of the rising trend-line from the origin of the bull move back in June, intersecting with the 0.5 Fibonacci level and the upper side of the orange channel where price consolidated for two months (resistance turned support). Target: $1475 are.
2) The lower side of the orange channel, which acted as support between June and August. Target: $1425
3) The 0.382 Fibonacci level down to the lower blue dashed trend-line which would be a full retest of the initial multi-year consolidation breakout.
The upper blue dashed line is significant acting as resistance of a multi-year channel drawn on the weekly chart, which I'll post in the comments.
My opinion is price will likely bounce from all three support levels and a change in sentiment can happen quick leading to a break back to test the highs. (economic conditions, looming risk)
Banks took the opportunity of a high liquidity event (NFP) to dump paper on the market, obviously some speculators took profits, but I expect just as many will be using this as an opportunity to enter with trend to much higher levels. Dips could be bought up quickly. FOMC, rate cuts, QE, just around the corner... And long term there's no solution to the disaster CB's have unleashed.
1) Confluence of support consisting of the rising trend-line from the origin of the bull move back in June, intersecting with the 0.5 Fibonacci level and the upper side of the orange channel where price consolidated for two months (resistance turned support). Target: $1475 are.
2) The lower side of the orange channel, which acted as support between June and August. Target: $1425
3) The 0.382 Fibonacci level down to the lower blue dashed trend-line which would be a full retest of the initial multi-year consolidation breakout.
The upper blue dashed line is significant acting as resistance of a multi-year channel drawn on the weekly chart, which I'll post in the comments.
My opinion is price will likely bounce from all three support levels and a change in sentiment can happen quick leading to a break back to test the highs. (economic conditions, looming risk)
Banks took the opportunity of a high liquidity event (NFP) to dump paper on the market, obviously some speculators took profits, but I expect just as many will be using this as an opportunity to enter with trend to much higher levels. Dips could be bought up quickly. FOMC, rate cuts, QE, just around the corner... And long term there's no solution to the disaster CB's have unleashed.
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Weekly chart showing price rejection from channel resistance.
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Price looking to close just above my first support level. Black trend-line is important. Right in line with 0.5 Fib level. Guessing we'll get a bounce from here, probably in Asian session. Comex bears were pretty dominant into the close. They'll likely be back tomorrow attempting to break this level.
