FXWIREPRO: Gold Slides "now in Sloping Channel, Then Rising Wedge"

FXWIREPRO: Gold Slides "now in Sloping Channel, Then Rising Wedge"  - Likely to Drifts Between 1200-1250 With Selling Momentum

Technical Inference:

Now sloping channel, then rising wedge:

Broken below rising wedge base on daily chart at around 1240 levels, as a result, bearish swings now slipping through sloping channel.

Currently, facing channel resistance at 1231 levels.

Daily RSI has been converging downwards with every price dips ever since it has dropped from top-line of wedge formation (see downward arrows on price line & RSI).

Stochastic has been indecisive to signal clear trend momentum.

Although, the current prices have jumped today, it has still remained below 21DMA, while MACD still evidences bearish crossover near zero levels.

On a broader perspective, the precious metal hasn't been able to hold to 13-months highs (1284.41) (see monthly charts).

After a long term downtrend it has shown little strength upto 23.6% Fibonacci retracements from the recent lows of 1046.23, but it has not managed to sustain resistance at 1283.11 levels, dropped below 1249.35 mark (i.e. 23.6% fibo from the lows).

Hence, in this varied technical signals from daily and monthly, we could foresee the price of this precious metal to range in 1200 on south and 1250 on northwards in next week or so.

Having said that, the right strategy to deal with this puzzling trend is to continue with the “credit call spreads” that we’ve already advocated a month ago.

Well, to execute this strategy we like to go long in 1M (1%) OTM call, while writing 1W (0.5%) ITM call. This strategy likely to best serve the swings explained above.

The material has been provided by InstaForex Company - www.instaforex.com