06.05.201505:06 Forex Analysis & Reviews: Technical analysis and trading recommendations on Gold for May 06, 2015

The yellow metal extended rally for the 2nd day in a row. Today at the Asian session, the metal managed to hold with gains. We recommended buying above $1,185.00 in Monday's article with targets at $1,190.00, $1,192.00, and $1,195.00. In the latter case, it can retest $1,197.00 and $1,200.00. The metal touched $1,199.40 at yesterday's session and hit all my targets. If we look at the complete picture on the daily chart, the lower tops and lower bottom formation are still active. The nearest support is seen between $1,178.00 and $1,175.00. Below these levels, $1,165.00 is crucial this week. In case, the price closes below $1,165.00, we can expect $1,135.00 in the near term. As we recommended earlier (Monday's article), the price has been making a base at $1,175.00. The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced yesterday that the goods and services deficit was $51.4 billion in March, up $15.5 billion from $35.9 billion in February. This has been the worst data for the recent 6 years. The yellow metal used this opportunity to fly towards the crucial level of $1,200.00. At yesterday's session, the metal managed to close above 50Dsma. Today at the Asian session, the metal is facing strong resistance at $1,195.50 20Dsma. The trade favors buying above $1,196.00 with sl $1,192.00, targets are at $1,199.00, $1,206.00, and even $1,208.00. The hourly 61.8FE seems at $1,200.00 and swing high is found at $1,206.90. On the higher side, the yellow metal edged lower and probably made a double top at $1,214.70. Bulls must breach $1,215.00 to extend to $1,222.00, $1,224.00,$1,225.00, $1,234.00, and $1,240.00 in the coming weeks. This is too early to analyse $1,224.00 and $1,240.00, we will update later. The dips buying is still valid, but it is unable to take place at higher levels. For an intraday session, we recommend selling below $1,190.00 with targets at $1,186.00, $1,183.00, $1,180.00, and $1,177.00. Below $1,184.00, the intraday panic will be triggered and the $1,208.00 will be erased. The price has been consolidating for 4 weeks between $1,175.00 and $1,223.00. Finally, it gave a break on the downside, made a double bottom in the four-hour chart and changed the direction. The current trading pattern is formed between $1,174.00 and $1,200.00. Until the price closes below $1,200.00, the probability of another break on the lower side is high. Weekly strong support is found at $1,165.00.

Trade: Buying above $1,196.00, selling below $1,190.00.