2016-07-25 15:11:08

Review and dynamics
The USD continues to strengthen in the currency market and investors’ concerns about Brexit are decreasing causing the decline in safe-haven assets, such as the yen and gold.
With the opening of the trading day on Monday, the price of gold has been falling. The pair XAU/USD has broken down support level of 1323.00 (Fibonacci 38.2 and ЕМА144 on 4-hour chart) and fell to support level of 1313.00 (ЕМА200 on 4-hour chart).
US macro-economic data is positive, giving grounds that the US Fed may raise interest rates before the end of this year, which will support the USD and add pressure on gold.
On the daily and weekly charts the pair XAU/USD remains in the ascending channels with the upper limit above the level of 1385.00 (highs of 2014) and 1410.00 (Fibonacci 50% to the wave of decline since October 2012).

Our opinion
The pair XAU/USD is above the key support levels of 1260.00 (ЕМА200 on the monthly chart) and 1230.00 (ЕМА200 on the daily chart) and 1218.00 (Fibonacci 23.6%. The rise in the pair is likely to continue.
However, on the daily chart the indicators OsMA and Stochastic are giving sell signals; the indicators on the weekly chart are also reversing towards the short positions. On the monthly chart downward pin-bar started to develop. If the price remains the level below 1313.00 until the end of the week, the decline can continue to 1260.00, 1230.00 and 1218.00.
An alternative scenario suggests the rise in price up to 1340.00 and further rise up to 1385.00 (upper line of the ascending channel on the weekly chart), 1410.00 (Fibonacci 50.0%), 1435.00 (highs of 2013 ) and 1500.00.

Support levels: 1313.00, 1300.00, 1260.00, 1230.00 and 1218.00.
Resistance levels: 1323.00, 1340.00, 1370.00, 1385.00, 1400.00, 1410.00, 1435.00 and 1500.00.


Trading tips
Buy Stop: 1345.00. Stop-Loss: 1322.00. Targets: 1360.00, 1385.00, 1400.00, 1410.00, 1435.00 and 1500.00.
Sell on the market. Stop-Loss: 1330.00. Targets: 1300.00, 1260.00, 1230.00 and 1218.00.

At support level of 1313.00
At support level of 1313.00

In the ascending channel
In the ascending channel