FX.co ★ Trading plan for Gold for February 09, 2022

Technical outlook:

Gold prices have finally managed to reach the procted zone around $1,825-30 on Tuesday. The yellow metal has completed its proposed counter trend rally, which began from $1,780 lows over the last week. Bears will be now inclined to come back in control and drag prices lower through $1,780 in the next few trading sessions.

Gold has been working on the recent downswing of a smaller degree between $1,853 and $1,780, which is labelled as ab on the 4H chart presented here. Also note that the metal has now tested the back side of its short term support turned resistance trend line around $1,830 levels. The metal is expected to face strong resistance here and prices to drop towards $1,780 to complete the structure a-b-c-d.

Gold prices have also reached the Fibonacci 0.618 retracement of the recent downswing between $1,853 and $1,780 mark respectively. High probability remains for a sharp decline from current level ($1,827). For the above bearish structure to hold, prices must stay below $1,853 potential resistance going forward.

Trading plan:

Potential drop to $1,780 against $1,853.

Good luck!