FxWirePro: Gold upside capped by 20 –day MA, good to sell on rallies

• Gold has shown a mild recovery yesterday after slight jump in euro. The yellow metal hits high of $1332 almost $12 and trading at $ 1327.58. US dollar has shown minor weakness almost 50 pips yesterday and is trading at 89.92
   
• ECB minutes showed that it was premature to signal policy normalization due to weak inflation. The policy divergence between Fed and ECB shows that dollar is expected to strength further.
   
• On the lower side, any break below $1318 (55- day EMA) will drag the gold down till 1316 (38.2% fibo)/$1309. Bearish continuation only if it breaks below $1305 level.
   
• The near term resistance is around $1336 (20- day MA) and any close above will take the commodity till $1342 (50% Fibo)/$1348/$1355. Overall bullish continuation only above $1366.

It is good to sell on rallies around $1327-29 with SL around $1336 for the TP of $1318/$1309.