XULF Report
Today gold has some trimmed some losses attributed to the US Non-Farms last Friday in a thinly traded market and has been consolidating for the last 6 hours between $1384 and $1388. In the short term the signals are bearish across most timeframes. The bullish trendline on the 4 hour chart has been broken and the 20 MA has just crossed below the 50 MA warning that the bears may get a firmer grasp of this market and the weekly chart is also bearish with two consecutive shooting stars. The 5 minute chart shows price has recently broken today’s upward trend indicating the retracement is rather weak. Therefore a short trade with a tight stop above today’s high around $1388/89 would be the obvious short term play with a low risk entry. Target levels are Friday’s low of $1378.80 and $1373.60 which acted as a strong support level on 28th May. If these levels fail to support gold then target $1354 which is the next support level established 22nd May. The economic calendar starts to get busy tomorrow so today is a good opportunity to apply price behavior tactics but do bear in mind that trading is rather light which can result in sharp and sudden movements that turn out to be misleading.
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