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Gold Chart 19/02/2016


Gold rallied on Thursday, breaking above the resistance (now turned into support) area of 1215 (S1). However, the advance was halted slightly above the 1235 (R1) level, and then the metal retreated somewhat. Although, the price is trading below the uptrend line taken from the low of the 3rd of February, I believe that the bulls are likely to remain on the front seat. A clear move above 1235 (R1) is likely to confirm that and could first aim for the 1250 (R2) resistance zone. Looking at our short-term oscillators, I see that the RSI emerged above its 50 line, while the MACD has bottomed near its zero line, turned positive, and crossed above its trigger line. These indicators detect positive momentum and support somewhat that the metal is poised to continue higher, at least for a while. Switching to the daily chart, I see that on the 4th of February, the price broke above the long-term downside resistance line taken from the peak of the 22nd of January 2015. As a result, I would consider the medium-term outlook to be cautiously positive and I would treat the setback from 1265 (R3) as a corrective phase for now.


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