Gold price reversed from my target area towards $1,170 as expected. As I had mentioned last wee, gold price reached the area where I preferred to take profits without opening new long positions. Gold price was expected to pull back and has now reached channel support.
Gold price is testing channel support and kijun-sen support (yellow line indicator). Gold price remains above the cloud support approaching higher highs and higher lows. A bounce from current levels to new highs is justified. Bulls could get the second and last chance to reach the level of $1,200 soon, but if we break below this channel, only a double top should be expected.
Red line - broken resistance
The weekly cloud had closed above the previous weekly high and we started the week with a pullback resulting in a test at the breakout level of $1,170. The price has not reached the Ichimoku cloud yet and there are still many chances of seeing $1,200. However, bulls should be very cautious and use tight stops.