Gold has retreated after finding resistance at 1247 levels to trade around 1230 levels, erasing some earlier gains made in the early US session. However, downside is set to be limited as the commodity finds strong support at 1218 levels as a result a strong rebound can be expected sooner or later.
- The commodity is poised to breach the resistance level located at 1247 and advance further towards upside as the demand for yellow metal increased as concerns over global economic growth increased after down beat data from China.
- 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 1220, targets around 1247/1272, SL 1206
Support levels: S1-1226, S2-1218, S3-1206
Resistance levels: R1-1247, R2-1263, R3-1272
