written by: Harish Shahi
Till the last week bulls were leading in the game and were dominating the bears at every nook and corner and it marked a high of $1358 level on Friday but on same day bulls could not sustain and slipped down to $1341 level and result was a gravestone doji. Well yesterday bulls started their journey with fresh energy and made a bounce from $1332 to $1343 level which was a strong counter attack on daily basis.
In the last week we have seen some correction where some profit booking was going on. But recently we have seen again bulls are dominating the bears. We are waiting for the clear breakout of $1350 level which will give us new buy signal and we are expecting that bulls will arrive at $1400 shortly.
From technical prospective we can see that a rounding bottom pattern has been completed on daily chart which is providing us bullish signal and a valid breakout of short term downtrend line is also pushing us to keep our bias as bullish on the gold as long as $1320 level remains intact.
Overall gold is making successively higher highs and higher lows and bulls even breached a short term downtrend line also and heading towards north side with strong bullish momentum. The coming week’s are very crucial for yellow metal as we can see on the chart that $1357, $1365, $1375 and $1396 is the high of preceding year which can’t be ignored at the moment. Presently short term to intermediate term trend is up so in an uptrend market buy on dips will be profitable strategy, and to have a strong bull run dollar’s weakness is also required which is almost there.
The way bulls are reacting it seems like they are approaching the $1400 level in near term and every dip should be convert as buying opportunity. Overall bulls are driving the car and approaching the $1378 level initially which is a key resistance level or high of February 2019 high. Well the way bulls are reacting it seems like they are trying to mark a new high of this year 2019.
Bulls are still sustaining below the $1350 level which is point of concern, if bulls really want to hit the new high of this year then they have to clear the $1350 level aggressively with strong bullish momentum. If gold trades and sustains above $1350 level then we will see further bullish sentiments and it will become stronger. To have a real bullishness in the yellow metal, bulls need to trade and sustains above $1350 level on daily basis, which will open the way towards the $1380 and $1400 level.
A bullish crossover on the MACD indicator is a recent development on the chart which is providing us bullish signal and providing strength to the bulls. RSI is also providing bullish signal from positive territory. The $1370 level is key resistance level followed by $1390 whereas $1320 is key support level followed by $1300 level. Odds are in favor of bulls and daily to weekly bias remains bullish on the yellow metal.