Gold closed last night (January 25) below the psychological $1200.00 level as the USA 30 closed north of 20,000 for the first time and created another new record high. The rally in US stock markets was continued in Asia overnight and the Nikkei closed with a 1.81% gain. The fact that the DOW managed to finally pass the 20,000 mark has boosted investor confidence and banks, insurers and brokers led the Topix higher. European stock markets continue to rise, with the DAX (GER 30) up 0.60% and moving further above the 11800 mark. The FTSE 100 (UK100) remains driven to a large extend by currency moves and while it continues to underperform the DAX as Sterling is up against the EUR, it has managed to extend gains as the Dollar strengthened and the Pound moved off earlier highs. Improved optimism over corporate earnings and the world growth outlook is underpinning the global stock market rise and it seems so far concerns of a fresh rise in protectionism across the globe hasn’t seriously dented investor confidence.
The risk off rally in stocks and the six day rejection of the 1220 level offered a SHORT position in GOLD. The entry in XAUUSD was 1199.80, with Target 1 beyond the 20 DMA at the 38.2 Fibonacci level of the recent rise from the low at 1121.38 at 1182.80. Target 2 is the key 1170.00 pivot area and the 50.0 Fibonacci level. The 1170.00 area was important when I last traded Gold (December 1) on its break of this level it went to my target 1 at 1140 but missed target 2 1120 by little more than 1 USD.
https://analysis.hotforex.com/ has had a 100% start to 2017 with five trades achieving both Targets 1 and 2 and a three trades hitting target 1 for a total net gain of 1632 pips.
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