By: DailyForex.com
Gold (XAU/USD) spent another week above 1750.00 but has basically traded sideways since breaking above 1750 on September 13. The pair has made only one serious attempt to push back below 1750 but failed on September 26 followed by a slow dance slightly higher to mark a new yearly high at 1795.70 before maxing out the Weekly RSI & turning bearish on Friday, falling back inside the 'box'. This could be the start of a pullback after such a strong push higher which began in August after 14 weeks of consolidation below 1650 and above 1550. Noticing a pattern here? This pair seems to be held in check by the 'psychological' barriers such as those beginning with '5' or ending in zero, and lately more than usual. This could also be the beginning of a consolidation period similar to the one we saw for weeks beginning in May of this year. If that is the case, there will still be plenty of trading opportunities on the lower time frames, but Swing traders will be twiddling their thumbs until the pair either closes above 1800 or back below 1700. I still have a bullish bias on this pair, but will be watching the levels of 1750 and 1800 closely.
Happy Trading!