XAU/USD soars to 1,259.00

FX_IDC:XAUUSD   Gold Spot / U.S. Dollar
XAU/USD soars to 1,259.00

After forming an inverse head and shoulders pattern and bouncing off from the weekly S2 at 1,235.93 the yellow metal managed to advance by 1.23% against the buck. In daily perspective the surge the is expected to last until the rate makes a new rebound either from the 1,263.63 resistance level or from a combination of the 200-day SMA and the 38.2% Fibonacci retracement level at 1,268.00.

However, through the day the soar is likely to be stopped by release of information on the American Core Retail Sales. In this sense, there is a need to take into account the resistance zone formed between the 1,259.00 and 1,259.32 marks and support zone located between the 1,254.00 and 1,253.62 levels, which are likely to squeeze the pair for some time.
Comment: XAU/USD forms symmetrical triangle

Even though the US House and Senate came to agreement on tax reform while the Census Bureau showed an increase in the Core Retail Sales, the exchange rate did not even pass the 1,250.00 mark. From technical point of view, yesterday’s movement revealed that the pair is moving simultaneously in junior ascending and descending channels that are located within the three-week long channel down.

For this reason, the rate is expected to continue paving path to the north despite the hindrance set up by the 200-hour SMA and the weekly PP. In support of this, an absolute majority of pending orders in 500-pip range are set to buy. However, there is a high chance that this target will not be achieved today due to empty economic calendar and traditionally low trading activity.

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