Since the beginning of this week the price of gold has declined, as investors close long positions in anticipation of tomorrow’s meeting of the US Fed.
Today, gold is traded in the narrow range and the volume of the trades is minimal.
On the weekly chart the pair XAU/USD fell below support level of 1238.00 (ЕМА144). The indicators OsMA and Stochastic are reversing towards the short positions. On the daily and 4-hour charts the indicators give sell signals.
Breakout of support levels of 1218.00 (Fibonacci 23.6%) and 1214.00 (ЕМА200 on 4-hour chart) will give a chance of the further decline in the pair XAU/USD.
Consolidation of the price below the level of 1157.00 (ЕМА50 and middle of the channel on the weekly chart and ЕМА200 on the daily chart) will bring the pair XAU/USD back to the downtrend in the descending channel on the weekly chart with the bottom limit below the level of 1030.00.
A scenario of the rise in price will be possible if the US Fed indicates that interest rate will not be raised.
In this case the price of gold continue to rise up to 1300.00 (highs of 2015), 1323.00 (Fibonacci 38.2%), 1385.00 highs of 2014), 1435.00 (highs of 2013) and uptrend, which lasted until mid 2010 will continue.
Support levels: 1218.00, 1214.00, 1200.0, 1157.00, 1061.00 and 1048.00.
Resistance levels: 1238.00, 1258.00, 1285.00, 1300.00, 1323.00, 1385.00 and 1435.00.
Sell Stop: 1225.00. Stop-Loss: 1240.00. Targets: 1218.00, 1214.0 and 1157.00.
Buy Stop: 1245.00. Stop-Loss: 1230.00. Targets: 1258.00, 1285.00, 1300.00, 1323.00, 1385.00 and 1435.00.