FxWirePro: Gold forms shooting star in daily chart, good to sell on rallies

Candle stick Pattern – Shooting star

• Gold declined after showing minor jump above $1300 on account of profit booking. The yellow metal has shown a jump above $1300 after brexit vote. The yellow metal declined almost $17 from the high and is currently trading around $1286.
   
• Fundamentally the downside will be limited due to continuing weakness in the stock market and more political uncertainty.
   
•  DXY is consolidating in narrow range after forming a top around 94.15. Minor jump can be seen in U.S Dollar index only if it breaks above 94.29 (23.6% fibo) and break above targets 95.
   
• U.S 10 year yield hits lowest level since Jun 2017 at 2.16% on doubts about fiscal stimulus from Washington.
   
• Technically gold is facing major resistance around $1300 and any convincing break will confirm major trend reversal. Any break above will take the yellow metal till $1310/$1325.
   
• Gold’s near term support is around $1277 (23.6% retracement of $1204 and $1300.66) and break below will drag the commodity down till $1270 (21- day EMA)/$1256 (100- day MA).The yellow metal should break below $1195 for major trend reversal. 

It is good to sell on rallies around $1288-$1290 with SL around $1300 for the TP of $1270/$1261.