Gold is presently testing the intermediate resistance of its medium term bearish channel at 1,645 and is likely to decline. However, in case these levels are passed though, the significant potential will be released enabling to reach its upper limit in 1,668.
Technical indicators provide sellers signals but as long as the resistance is not broken, the assumption of possible decline is relevant. Bollinger bands have greatly tightened in recent days showing a decline in volatility and the imminence of a violent movement.
Considering previous events the market will provide a bullish opportunity as soon as the gold has broken through its resistance of 1,645 with 1,655 and 1,658 seen as targets. If the level 1,642 is passed through, the proposed scenario will be invalidated.
The material has been provided by Instaforex Company - instaforex.com
