Gold finally surges above an 8 weeks range as it hits its highest price since August. The US inflation data came worse than expected at 0.1% against the expected 0.2%.
Gold price gained massively on Thursday with a huge bullish momentum to trade at its highest since late August. Earlier in the week, the bears threatened, drove price close to late September 1180 support. The US inflation data came worse that expected and added to a bearish Dollar. The current price surge has seen Gold gained about 250 Pips which is about +2%. The 1208-1214 barrier which was held for about 8 weeks was easily taken out as the yellow metal trades in excess of 1210.
Gold Technical Analysis and Important Price Levels
In the last update, we expected a break below 1180-1182 to see price drop further to 1175 and 1165. Price stayed above 1182 yesterday despite the fast bearish move that followed the Chinese rate cut last Sunday. Above 1182, there was 1192 intraday resistance that needed to be taken out to confirm the end of the sudden bearish move. The chart below was used in the last update.
The fall is emerging into an impulse wave. From 1208, a bearish impulse wave could continue to 1175 or 1165 before the next bullish correction or continuation. The next support is at 1180-1182. A break below 1180-1182 could see price at 1175 and 1165-1160. 1192-1193 is nearest resistance zone. A break above 1192-1193 could see price heading back to 1208 and an outright bullish breakout.
The bearish drive from 1208 was halted at 1182 as price formed an intraday reversal pattern. The reversal pattern was quickly followed by a strong bullish move above 1192 to terminate the idea of a bearish impulse wave below 1180. the chart below shows the new update.
The 2 month range from 1214 to 1180 is clearly corrective. 1180-1182 still remain a solid support price zone. With the breakout above the 1208-1214 resistance zone, price is expected to continue upside. There might be a retest of the 1208-1214 resistance zone before it advances further. Early August 1217-1220 resistance zone is the next barrier on the way to 1230-1240 handles.
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