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19.10.201509:47 Forex Analysis & Reviews: Gold technical analysis for October 19, 2015

Long-term review

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Gold price reversed from my target area towards $1,170 as expected. As I had mentioned last wee, gold price reached the area where I preferred to take profits without opening new long positions. Gold price was expected to pull back and has now reached channel support.

Red lines - bullish channel

Gold price is testing channel support and kijun-sen support (yellow line indicator). Gold price remains above the cloud support approaching higher highs and higher lows. A bounce from current levels to new highs is justified. Bulls could get the second and last chance to reach the level of $1,200 soon, but if we break below this channel, only a double top should be expected.

Black lines - broken triangle

Red line - broken resistance

The weekly cloud had closed above the previous weekly high and we started the week with a pullback resulting in a test at the breakout level of $1,170. The price has not reached the Ichimoku cloud yet and there are still many chances of seeing $1,200. However, bulls should be very cautious and use tight stops.

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