The resurgence in the Gold price (XAUUSD) in the last month has been a story of a trend winding itself up.
The break of $1235, a key resistance and 38.2 Fib level, was the first step, and the 200-day MA and psychological $1250.00 came next and proved more resilient. But a strong breach of this level on December 20 only held at $1265 and the 50.0 Fib level for 2 days.
Last week the GOLDEN RATIO 61.8 level at $1286 was breached for the first time as the yellow stuff moved into overbought territory, with RSI flashing at 78.78. $1300.00 appeared inevitable, but has been a step too far for now. However, the 50-day and 200-day EMA look to be heading for a key Golden Cross, but like $1300 not yet.
After such a strong rally to the 61.8 level and the inevitable bout of profit-taking, a significant retrace to $1265 and the key 200-day moving average cannot be discounted, but a breach of $1300 and $1305 would put $1320 as the next target level.
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Head Market Analyst
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