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Stability above 1558.00 has completely damaged the harmonic 5-0 pattern discussed yesterday. Although, it is a bullish pattern but we should witness a downside correction before moving higher. After this failure, we will look at the ascending channel that dominated the movements from 1477.00 zones to present levels. This bullish channel has support line meeting SMA 20 as seen on the graph. But, momentum indicators are showing clear overbought signs and that may cause correction downside wave. Stability above 1550.00-1562.00 makes the bullishness valid; whilst a break of 1548.00 may damage the bullish wave temporarily.
The trading range for today is among the key support at 1538.00 and key resistance now at 1608.00.
The general trend over the short term basis is to the upside, targeting $ 1600.00 per ounce as far as areas of 1430.00 remain intact with weekly closing.
Weekly ReportSupport1562.001558.001550.001548.001540.00Resistance1575.001580.001585.001600.001607.00RecommendationBased on the charts and explanations above our opinion is, buying gold around 1558.00 gradually targeting 1575.00, 1585 and 1600.00, while the stop loss is a four hour closing below 1545.00 might be appropriate.