In the end of the last week, the price of gold significantly grew that was the result of a fall in the USD after the ECB meeting.
The European regulator cut its deposit rate by 0.1% and left the interest rate unchanged at 0.05% as markets expected. In addition, the ECB extended its QE program until March 2017 but contrary to expectations did not expand it thus causing a growth in the Euro and decline in the USD.
At the same time, in her speech Fed Chair Janet Yellen did not indicate the date of an interest rate increase again and pointed out that when making its decision the regulator will be considering macroeconomic data.
Support and resistance
Bollinger Bands on the daily chart is turning up, while the price range is widening. MACD is growing and giving a strong buy signal. Stochastic is also growing and approaching the overbought zone.
The indicators recommend considering long positions.
Support levels: 1080.84, 1074.45, 1070.00, 1064.64, 1060.00 (local low), 1052.58, 1046.17 (3 December low).
Resistance levels: 1088.66 (local high), 1095.53, 1101.05, 1105.50, 1110.00 (6 November highs), 1115.70, 1121.11.
Long positions can be opened after the breakout of the level of 1085.00 with targets at 1101.05, 1110.00 and stop-loss at 1077.45. Validity – 2-3 days.
Short positions can be opened after the price consolidation below the level of 1079.60 with the target at 1068.00 and stop-loss at 1084.50. Validity – 2-3 days.