XAU/USD daily overview
After the massive drop caused by the appreciation of the US Dollar on Tuesday, the yellow metal's price traded sideways between two pivot point levels. However, it was about to continue the decline.
The reasons for such hypothesis are two. First is the fact that the metal has fully confirmed the breaking of the previous dominant channel up pattern. Second is the fact that the fall of Tuesday revealed a junior channel down pattern.
In general, the surge should occur, when the upper trend line of the junior pattern forces the commodity price lower through the support of the weekly PP, which is located at the 1,316.08 level.
The reasons for such hypothesis are two. First is the fact that the metal has fully confirmed the breaking of the previous dominant channel up pattern. Second is the fact that the fall of Tuesday revealed a junior channel down pattern.
In general, the surge should occur, when the upper trend line of the junior pattern forces the commodity price lower through the support of the weekly PP, which is located at the 1,316.08 level.
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The support levels just above the 1,300.00 mark where reached even faster than it was expected.
Mainly the move has been associated with the strength of the US Dollar, but the combination of various supports at the mentioned level managed to force the metal into a rebound.
During the rebound various resistance levels where passed, and by the middle of Friday’s trading the bullion was trading sideways above the 1,315 mark.
In general, the situation needs to be watched, as a sudden surge or decline was about to occur.
The support levels just above the 1,300.00 mark where reached even faster than it was expected.
Mainly the move has been associated with the strength of the US Dollar, but the combination of various supports at the mentioned level managed to force the metal into a rebound.
During the rebound various resistance levels where passed, and by the middle of Friday’s trading the bullion was trading sideways above the 1,315 mark.
In general, the situation needs to be watched, as a sudden surge or decline was about to occur.
The expected decline of the yellow metal has occurred. However, it did not come into reality exactly as it was expected.
The bullion broke the narrow ranged channel down pattern. The narrow pattern turned out to represent the junior decline in the borders of a wider descending pattern.
The newly discovered pattern was the one, whose upper trend line provided the resistance needed for the speculated decline.
In regards to the near future, on Thursday morning the range down to the levels near the 1,300.00 mark was free from support.