Gold Turns Higher as Dollar Falls

13 September 2017 10:08:38 AM

Gold edged higher on Tuesday, recovering a portion of the previous day’s losses, as the dollar pared gains. The precious metal was also supported by U.S. President Donald Trump’s comments on U.N. sanctions on North Korea. XAU/USD is trading at $1331.44 an ounce, slightly lower than the opening price of $1332.15.

From a chart perspective, there are two things that catch my attention at first glance. XAU/USD is above the Ichimoku clouds on the weekly and the daily time frames and the Tenkan-sen (nine-period moving average, red line) and the Kijun-sen (twenty six-period moving average, green line) are positively aligned. However, the short-term charts remains slightly bearish. The market is trading below the clouds on the H1 chart.

XAUUSD h4

If the 4-hourly clouds continue to be supportive and prices can get back above 1332, keep an eye on the 1339/8 zone. The bulls have to capture that strategic camp in order to make an assault on the 1345/2. A daily close beyond 1345 is essential for a continuation towards 1358/3. On the other hand, if the market fails to penetrate the hourly cloud and drops through the support in the 1323/1 area, look for further downside with 1318-1316.50 and 1312 as targets. Breaking down below 1312 on a daily basis could trigger further weakness. In that case, the 1304/0 zone will probably be the next port of call.

XAUUSD h1

Alp Kocak has been trading Forex since 2003. He writes technical analysis based on Japanese candlesticks and Ichimoku Kinko Hyo.

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