Saturday, August 31, 2013

Gold HIts Resistance -- What Next? Chart

Gold broke out to a months-long high this week, but also hit overhead resistance.  What happens next?  Here's my chart analysis ...

As you can see, gold ran into trouble right around the 50% retracement of its recent move lower.  After rallying since late June, gold got overbought for the first time since October. As a side note, this overbought condition and pullback in gold coincided with an oversold bounce in the US Dollar Index. 

A pullback to test a support zone around $1,346 would not surprise me. Anything can happen, so do your own due diligence. But if you are looking for an opportunity to buy into the gold rally, it may be coming up. 

Good luck and good trades.

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