XAUUSD (GOLD) LATEST SCENARIO AND CHART 26/02/15

Now for gold traders,..as expected, gold found support almost exactly at the Fibonacci 50% level (where yesterday’s second buy signal was placed), then started rising strongly. The precious metal bottomed at 1201.1, which is only 2 pips below the Fibonacci level, then skyrocketed to a current daily high of 1219.9.

This expected move takes closer to last Thursday’s high 1223.0. A break above this level would be a good step towards confirming that we have seen an important bottom at 1190.6, which is not very far from our projected bottom 1188.0. A break above today’s current high 1218.1 would probably push the price towards 1223.0, and if we break this level we will be on the way towards the first short term Fibonacci level at 1227.2. This level is followed by other important resistance levels at 1231.6 & 1238.4. If the price reaches this level is specific, and starts showing signs of weakness, this good run may be over, but if we break above it, then we should get ready to see the price testing 2 important levels at 1245.1 & 1249.5.

On the support side, first we have 1210.5. Any dips that do not break below this level do not harm the short term bullish outlook. In fact, approaching this level may provide a good chance to go long. However, if the price breaks below this level, we should expect it to drop towards 1206.5 first, and if this level gives way we could be very much on the way towards at least one of the micro term retracement levels at 1205.3, 1201.8 & 1199.0. As long as the price is above this last level, the overall picture of a bottom very close to 1188.0 then a significant rising move will continue to be our favorite. But if we break below this level, although it is not expected, another trend low will become probable. The spotlight will be back to 1188.0, which I still believe is the most important support in this area. As said in yesterday’s report, gold could find support very close to 1188.0 then start rising again, and it looks like this is still a decent possibility today. But in case the price breaks below the important 1188.0 things will worsen even more, as the bears will be expected to target 1183.1, 1175.6 & the major January bottom at 1168.0. If the bears continue to push lower, and break below 1168.0, we should expect the price to test the 1161.2/6 area ahead of 1153.6 & 1146.7.