FX.co ★ Trading plan for Gold on May 31, 2022

Technical outlook:

Gold prices slipped through the $1,846 lows on Monday before finding mild support. The yellow metal managed to rally through the $1,857 highs intraday on Tuesday only to find resistance again. It is seen to be trading at around $1,849 at this point in writing. Gold is expected to remain under pressure heading for $1,838 at least.

Gold continues to unfold its counter-trend rally towards $1,920 going forward. It has completed the first leg at around $1,870, while the second wave is expected to drop through the $1,820 levels respectively. Its final rally is then expected to push through $1,920 levels, which is the Fibonacci 0.618 retracement of the above drop.

Gold prices are working upon the larger degree downswing between $1,998 and $1,786 as marked on the 4H chart here. The Fibonacci 0.618 retracement is seen passing close to $1,920. Hence, the probability remains high for a bearish price action if prices manage to reach there. Traders prepare for a short-term rally through $1,920 that will be followed by a bearish reversal.

Trading plan:

Potential rally through $1,920 against $1,780

Good luck!