Downward correction is probable.

On the 4-hour chart, the price bounced off the level of 1125.70 (38.2% Fibonacci correction) and started growing along the 38.2% arc. The next bullish target seems to be the area of 1137.90-1140.00 (a crossover between the 38.2% medium-term correction and 0% short-term correction), which is unlikely to be broken out in the near future. The more likely seems to be a price reversal that can be seen on the daily chart. Here, the price stopped at the crossover between the 38.2% correction and the 50% arc at the level of 1137.90, which creates a possibility of a fall along the 50% arc towards 1124.00 and 1117.10 (23.6% correction). However, the breakout of the 1137.90-1140.00 area would allow the price to grow to 1143.20 and 1154.50 (50% correction for the medium-term trend).

Trading tips

Sell the pair from the level of 1131.00 with targets at 1124.00, 1117.10 and stop-loss at 1136.80.

Alternative scenario

Buy the pair after the price consolidation above the level of 1140.00 with targets at 1143.20, 1154.50 and stop-loss at 1133.00.

XAU/USD: Fibonacci analysis

XAU/USD: Fibonacci analysis

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