Thursday, April 19, 2012

Gold Head & Shoulders

Traders of Gold should keep their eyes on the current Head and Shoulders pattern hitting the metal.  The pattern has occurred as prices have built up support at 1630 following an early fall this month, but have failed to hold retracement gains (see chart).  As such, today's US Data will be in focus today as the figures are expected to effect moves int the US dollar, which should result in increased Gold volatility.  Therefore, if the news triggers Gold prices to fall below its current 1630 support level, due to the bearish Head and Shoulder pattern, momentum could build up and push prices all the way down to 1600.  On the flip side, any break above 1662 will put this months 1690 highs back in play.

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