Gold rally stalls at first resistance

16 авг. 2015 г.

Gold has been following EUR/USD closely this week: correlation coefficient for H4 charts held above 0.85 most of the time. Just like the euro, price of gold didn't manage to break the first resistance cluster -- in this case, 1122.60-1125.70 area. On Thursday's close, a bearish candlestick pattern 'Dark Cloud Cover' was formed, which signaled the price could retrace to 1108 and 1100 support levels. The chart also shows a similar bearish pattern ('Evening Star'), formed on June 20, that led to a sell-off below 1080 area. In both cases, patterns were formed at Andrews Pitchfork's resistance line. Thus, for bullish scenario to unfold, the price needs to break this resistance, which currently stands at 1124.

Major economic calendar events for next week include:
Wed, US CPI data
Wed, FOMC Meeting Minutes
Fri, Eurozone PMI reports