FxWirePro: Gold outlook – consolidation at key area

Recently there has been some excitement regarding gold as tensions escalate in Middle East. Turkey has downed a Russian Military Jet, accusing violation of air space, which Russia denied. Russia warned Turkey over serious retaliation and now sending an advanced air defense system to protect its air crafts. NATO members are scratching their heads over how Russia might retaliate.

Gold has found support amid all this escalation, however sellers are still quite at large. Nevertheless it is worth noting that this consolidation, which might continue for some days as ECB monetary policy and US NFP report for November scheduled next week, is happening close to a key support area.

Gold has been within a downward sloping channel since April, 2013 and now trading very close to channel floor.

Despite that buying is not suggested, given key pieces of event risks scheduled next week and mid-December.

It is advised to continue on the short trade but be cautious over fresh shorts as support is close by and a hike from FED is well anticipated.

For Gold traders, patience will be key.