Technical outlook and chart setups:
The yellow metal BREAKS multi month support at 1,520/25 levels on Friday giving in almost 8-10% lower immediately. The intraday lows are at 1,385.00 for now and it is expected to produce a counter trend rally soon. But rather than bottom fishing and loosing trades, it is recommended to stay flat for now and let a counter trend reversal signal be produced, or wait to initiate short positions at major support turned resistance at 1,520/25 as shown on the chart here. Please note that buying should be completely avoided for now, and selling rallies should be favored trading strategy from here on. The entire structure reveals that the yellow metal could be heading towards 1,200-1,500 levels on the lower side. This is re-enforced by the 0.5% and 0.618% of the entire rally from 780 to 1,930 level since 2008. Looking to sell rallies from here on.
Trading recommendations:
Flat for now. Looking to sell rallies aggressively now. 1,520/25 remains on interest to go short.
Good luck!
The material has been provided by InstaForex Company - www.instaforex.com
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