XAU/USD 4H Chart 12:13PM EDT 8/10/2012
Gold has been trading more or less sideways since pushing above a declining trendline seen in the daily chart, which was holding price in a triangle. Now, above the triangle, the market appears to be channeling upwards. The 4H chart shows that the 8/10 session broke above the August high, which was near 1618. We still have the 1629 resistance to test before targeting the 1650 handle. So far however, the breakout looks a bit suspect, especially if today’s close (8/10), also the week’s close, is back below 1618.
The 1650 handle is seen in the daily chart near the 200-day SMA. This starts a zone of key resistance that include a projected channel resistance and a declining trendline that goes back to the record high set in Sept. 2011.
A break below 1620 however keeps things unclear and sideways. A break below the 1603 support pivot and then the psychological 1600 handle might bring about some bearish outlook in the very short-term, but only a break below the rising pattern in the daily should introduce the bearish continuation scenario.
XAU/USD Daily Chart 12:16PM EDT 8/10/2012
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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