Gold Holds Below Resistance Around $2075

21 September 2020

Gold continues to drift sideways within the potential contracting triangle structure since hitting all-time highs around $2075 levels in mid-August. The yellow metal historically produces a sideways movement before breaking towards the major trend, which looks lower.

GBPUSD probable wave counts are as follows: The drop from $2075 through $1862 could be labelled as lower degree Wave 1. Since then the structure might be that of a contracting triangle, which looks complete around $1975 levels over the last week.

If the above structure holds well, Gold might have carved lower degree Waves 1 and 2 around $1862 and $1975 levels respectively. The yellow metal should remain below $1975 levels and reverse sharply from here. A break below $1900 would be encouraging to bears.

Also note that a contracting triangle unfolds into 5 wave’s a-b-c-d-e (not labelled here). If it is a bearish triangle, Wave e might have already terminated around $1975 levels. A break below $1900 will confirm that bears are back in control and would push through $1862.

Alternately, a push beyond $2000 would indicate that the triangle structure is breaking on the north side and Gold might attempt to rally beyond $2075 in the next few weeks. Also note that the rally could be fast and a final thrust before bearish reversal.

Traders might remain flat for now and wait for a break above $2000 to initiate longs or below $1900 to initiate fresh short positions. A protective stop could be place above $2075 on a bearish break.

Prepared by
Technical Analysis Team

Disclaimer: This information has been produced by a third party, for general information purposes only, and is not indicative of future results. Abans Global takes no responsibility for its accuracy or completeness. Any opinions expressed do not reflect those of Abans Global. This information does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should seek independent advice before making investment decisions. Reproduction of this information, in whole or in part, is not permitted. Please note: If you are a Professional client, you are not eligible for negative balance protection and you could lose more than your initial deposit.

Trade with
Abans Global

  • Authorised and Regulated by FCA
  • Customer Support 24/5
  • Low Spread & Commission
  • Instant Execution
  • No Dealing Desk
Interested in knowing more about our products

Simply send an e-mail to us at: support@abansglobal.co.uk
Contact us on +44(0) 203 936 9000

We will be happy to address all your queries

Our Products

Offering state of the art execution services through multiple top-tier liquidity providers. Abans Global provides you with a tailor-made solution to match the demanding requirements of your business, with the multi-assets offering, advanced trading platforms and FIX API connectivity that provides ultra-low latency.

Forex

Forex

Know More

View more
Cfd’s

Cfd’s

Know More

View more
Equities

Equities

Know More

View more
Indices

Indices

Know More

View more
Commodities

Commodities

Know More

View more

Create Demo Account

Try Demo

Create Live Account

Sign In