Gold Technical Update

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XAU/USD (Gold)

gold

As expected, the 1522-1530 range support provided a based for gold to recover after it fell sharply from around the central pivot of the range (the actual high was 1671.12). The concept of a range is that when the market is at resistance or support, and is extended in momentum, there is a tendency to return to the fair price , which can be interpreted as the middle or central pivot of the range. In this case, there is a central pivot around 1666.50.

So far the bounce has pushed gold just under 1600 as we gear up for the 5/18 US trading session. There are resistance factor from 1600 up to 1615.86(61.8% retracement of the recent bear run).

So first keep your eye on 1600 area. If the market is becoming bearish, or even just has one more leg to test the range support area, we might see some selling around here. But, if a bearish attempt fails to extend the current decline, the market is indeed reverting back toward the middle of the range near 1666.50.

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Fan Yang CMT is a forex trader, analyst, educator and main contributor for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.