FxWirePro: Gold responses to risk aversion after long gaps, time to go long

We, at FxWirePro, have long been sharing this figure above and it is worth sharing again. We have been raising the possibility of rise in gold price, especially from a two year old downward sloping channel. While channel break, always remains a possibility, but if it holds opportunity is large with small risks.

On final week of November, Gold first time posted a bullish engulfing, which we pointed out then, however due to upcoming FOMC, price action remained subdued.

Now with FOMC gone, rate been hiked, further hikes been well priced in and recently gold's response to risk aversion bringing us more firmly to the bull camp of gold.

Caution is - Gold is firmly in downward sloping channel, so expect bears to show up from time to time.

That however doesn't mean bulls won't have good times, especially when Gold is rising from Channel floor and responding to risk aversion.

Trade idea 

Buy Gold with stop loss around recent low around $1050 area. First target is $1140 area. Expect selling pressure in that region, which is interesting with previous rising trend line. Further targets would be updated later.

Gold is currently trading at $1105/troy ounce.