Gold bounced off the support zone at $1,615-20 for the third time since the end of September and started a strong recovery. Gold is now testing the resistance zone at $1,680. It should be noted that this is also the level at which gold was trading under 1660-70 before Wednesday's FOMC meeting, meaning that the gold price fully recovered losses after the FOMC meeting. In the event of a breakthrough above this zone, the upward movement could expand towards the next swing level in the $1700 range. If, on the other hand, the bears regain control, a pullback into the $1,640 range could be imminent.
Also, if we look back over last 15 yrs. of gold prices & observed EVERY major rally started with a big 1-5 day jump in gold prices off the bottoms. It always starts with short covering (that's the spike/signal). Then, when it's clear the rally won't reverse (bull move is on), longs come in.
Also, if we look back over last 15 yrs. of gold prices & observed EVERY major rally started with a big 1-5 day jump in gold prices off the bottoms. It always starts with short covering (that's the spike/signal). Then, when it's clear the rally won't reverse (bull move is on), longs come in.