The yellow metal traded higher on Wednesday as world equities turned lower after oil prices declined, shrugging off a steadier dollar following better than expected US factory output.
- The yellow metal declined towards 1226 levels in the early European session, before recovering to trade around 1240 levels.
- Any downside is expected to be limited as the support level located at 1226 is likely to hold the bears from falling further below and bring a rebound back towards higher levels.
- To the upside, the strong resistance can be seen 1247, a break above this level would expose the commodity towards 1272 levels.
- To the downside immediate support can be seen at 1226, a break below at this level will open the door towards 1218 levels.
Recommendation: Go long around 1225, targets around 1247/1272, SL 1206
Support levels: S1-1226, S2-1218, S3-1206
Resistance levels: R1-1247, R2-1263, R3-1272
