Gold: Support Above 1182.00 Next Downside Target and Barrier to a Potential Drop Towards 1130.00
The daily candle chart below shows the price history of Gold over the medium term. This Contract for Difference (CFD) aims to track the underlying spot price of the precious metal Gold, and is trading near 1187.15 around time of publication today.
Last time Gold was reviewed in Ideas You Can Trade earlier this month, support above 1200.00 was regained but was quickly lost after making a brief high above 1220.00 on April 6th.
Today Gold hit its second lowest-low for the month, and just above support near 1130.00 which is the next lowest-low since April 14th, and seems within very close range to testing support just below current prices.
If support on 1130.00 fails then a sharp bearish continuation should follow, whereas if support holds on that line - or is regained from above current levels towards 1200.00 (near today's high) then a bearish continuation could be avoided.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 1201.00 with a Limit to take profit @ 1208.00 and a stop-loss @ 1194.00 Risk/Reward Summary: Limit risk = +7.00 Profit / (-7.00) stop-loss risk = Gain to Loss ratio = 1.00
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 1185.60 with a Limit to take profit @ 1182.00 and a stop-loss @ 1188.00 Risk/Reward Summary: Limit risk = profit +3.60/ (-2.40) Stop-loss risk = Gain to Loss Ratio = 1.50
Medium Term Daily Candle Chart: