WEEKLY CHART
The gold price is back into congestion zone after a false break out at close of weekly candle(blue marking) on 1st Sept.
Currently what we see is price into support zone but no major reaction for bounce up. Price is into the 21 Simple moving Average (SMA) zone, great horizontal support around 1266 zone marked with a blue line
The momentum on the downside is still quite strong, so it can make some lower lows aiming for the previous red trendline support marked T
If in short trade, you could take out some of your profits as we wait for reaction in this large support zone (21 SMA, horizontal and trendline support).
SO WHATS NEXT on gold?
Depending on the price reaction on the current support zone, there are two major zones that could determine larger movement up or down.
These levels are support trendline T and horizontal resistance zone marked with red line R.
Close below T could lead price to retest previous lows of the congestion around 1212.885 support zone marked S.
Preferably if there is a small congestion on the current support zone to give momentum for gold price to fall through to S.
But if current price just falls through beyond T with no pause, it will have a hard time falling into S, we may see immediate support zones in this case hold.
Close above resistance R ,could give a true breakout that could push prices up.
Previous highs would of course be the immediate resistance zone around 1345 marked Z