The negative data from US effected GOLD rise up to 1218.75 but could not continue to get over this level. This critical level is so important that you can read detailed analysis for long term trading below.
For the short term, 1199.80 is a very important support level for today. Yesterday this level was broken as a resistance. So yesterdays resistance level is the major support level for today. If GOLD supports 1199.80, 1225 would be tested again. We expect this movement today. So beeing in SELL position is not a good idea. If testing of 1225 fails, 1199.80 would be the target. Watch for the movement up to 1225, be in long position till up there.
After FOMC statements in 18 March 2015 USD Index has fallen. As a result precious metals, especially GOLD had a rise but could not make it above 1225. For the last days, GOLD stayed above 1170 support and negative data from US supported its rise. Yesterday this behaivour has been seen effectively.
For long term analysis, until 2013 first quarter, GOLD is still in down trend and moving in this channel. The upper level of the channel which is 1290 is also the 30 months EMA of GOLD. So down trend for GOLD still continues for long term. We shall never forget this.
So can GOLD go for 1290 and test it? To get the answer to this question, the major resistance of 1225 must be tested first. This level also will create the middle term trend for GOLD.
If GOLD can break 1225 and stays over this level, 1245 – 1265 and 1290 would be seen soon. But for a movement over 1225, we need much more negative data from US. At this time there is no signal for such data and there is no macro-economic developments.
So traders in GOLD should be very careful, do short term trading and always use stop loss.