Gold - consolidating with upside potential

Gold outlook remains bullish. Daily chart indicates a consolidation around 1230 - 32 area, a resistance area from late last year (November). Given the precious metal has managed to break out of this zone, RSI and volumes remain high, further bullishness can be expected. Gold is usually inversely correlated to the US Dollar as well as Stock performance. Better opportunities in the market lead investors to move in between the asset classes. Gold has remained a great hedge instrument and is good to hold. Recent market volatility has attracted many traders towards this commodity with numerous intra-day trading opportunity.

In terms of technical analysis, the next target for the metal is seen at 1242 (matching 38% Fibonacci retracement level), where it will likely take few days to consolidate (like earlier in October) before moving higher to 1280.

On the flip-side a move lower will be protected by support around 1217 (January highs/resistance to become support) following support exists at 1180, on the daily chart. Some further levels can be seen in the chart.


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