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Fan Yang

Gold Forms a Bullish Engulfer with Bullish Divergence

Gold is poised to return to the low on the year at 1130. In the short-term however, it might have to deal with some bullish correction.

Gold (XAU/USD) 4H Chart 3/11
(click to enlarge)

The 4H chart shows a bullish divergence forming after seeing a bullish engulfing candle. At this point, if price can hold above 1160, there is upside risk towards the 1190-1200 area.

1190-1200 contain a previous consolidation support area and the 50-period SMA. We should expect resistance here and a bearish continuation attempt especially if the 4H RSI approaches then stalls around 60.

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