Gold Rises in Quiet Trade - 16 January 2018

Tuesday, 16 January 2018 7:39

Gold prices rose $3.24 an ounce on Monday and hit the highest level since September 8, supported by a weaker U.S. dollar index. World stock markets were mixed yesterday. U.S. markets were closed for a holiday. XAU/USD is currently trading at $1340.81, slightly higher than the opening price of $1340.18.

The bulls have the near-term technical advantage, with the market trading above the Ichimoku clouds on the daily and the 4-hourly charts. The Tenkan-sen (nine-period moving average, red line) and the Kijun-sen (twenty six-period moving average, green line) are positively aligned and the Chikou-span (closing price plotted 26 periods behind, brown line) also resides above the daily cloud. However, as I reiterated in my previous analysis, the bulls have to successfully lift prices above the 1244/0 zone to make a run for 1358/5. On its way up, expect prices to face some resistance in the 1350.80-1350 zone.

XAUUSD Daily

To the downside, the initial support sits at 1335.60. If the bears increase downside pressure on the market and pull prices below 1335.60, they may have a chance to test 1332.20-1330.70. Eliminating this support is essential for a continuation towards 1326. A break below 1326 implies that the market will visit 1321.

XAUUSD h4

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

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