Overview and dynamics
After reaching absolute yearly highs near the level $1375.00 per ounce in the beginning of July, gold price "br /laid by", trading mostly in a range between the levels 1365.00 and 1315.00.
In August, there was an attempt to break up the above range, however, the growth was not higher than the level 1365.00. On the daily chart a new downward channel has formed with a slight angle and the upper limit at the moment near the level 1360.00.
For the second day XAU/USD pair has been declining and investors gradually turn their attention to the speech of the Fed's Janet Yellen scheduled for Friday. After last week's series of statements by the Fed about a high probability of interest rate increase in the US before the end of the year, the market is growing expectations of such an increase.
If J. Yellen hints at the possibility of a rate hike in September, the dollar will strengthen sharply on the currency market, including in XAU/USD pair.
On the 4-hour chart XAU/USD pair found support at 1335.00 (EMA200, EMA144) and OsMA and Stochastic indicators went over to the sellers. On the daily and weekly charts indicators also reverse to short positions.
While XAU/USD pair is above the support level 1324.00 (38.2% Fibonacci level, EMA50 daily chart), long positions still remain relevant.
In case of a breakdown of this level the following levels will act as support levels: 1264.00 (EMA200 and the lower limit of the upward channel on the weekly chart), 1252.00 (EMA200 on the daily chart), 1218.00 (23.6% Fibonacci level). If the price fixates below these levels, this will create conditions for further declining of XAU/USD pair and returning to the downward global trend, which began in October 2012.
However, the preservation of the demand for gold will be contributed by the weak US economic indicators, the Fed restraint’s as to further interest rate rises in the US, remaining risks associated with the state of the world economy, and the prospect of further easing of monetary policies in a number of the world's central banks.
On the weekly chart XAU/USD pair remains within the ascending channel with the upper limit near the levels 1385.00 (2014 highs), 1410.00 (Fibonacci level 50.0% of the correction to the declining wave since October 2012). A break of the range above the levels 1365.00, 1385.00 will create risks for the gold price growth.
Support levels: 1335.00, 1324.00, 1316.00, 1300.00, 1264.00, 1244.00, 1218.00
Resistance Levels: 1365.00, 1385.00, 1400.00, 1410.00, 1435.00, 1500.00
Buy Stop 1342.00. Stop-Loss 1323.00. Targets 1365.00, 1385.00, 1400.00, 1410.00, 1435.00, 1500.00
Sell Stop 1322.00. Stop-Loss 1340.00. Targets 1316.00, 1300.00, 1264.00, 1240.00, 1218.00
At the support level 1335.00
In the downward channel