Time to Take Some Profits: Gold, DAX and SP500
New week starts with a correction of the recent movements so finally USD is gaining some strength and we do have a reversals on the Gold and DAX.
The most technical movement can be seen on the Gold which went to the 1258 USD/oz resistance, created a Head and Shoulder patter, broke the neckline and went lower. The first target for the decline was already made – we touched the lower line of the channel up formation. That may not be the end of the taking profit action. The price can decline further, to the 1244 USD/oz support.
DAX is also correcting the recent downswing. So far, we climbed back above the neckline of the H&S formation but due to the shape of that pattern I would not pay too much attention to that. We are about to test the horizontal resistances and in my opinion there is a negative sentiment here as long as we stay below the 12350 points.
On the other side and in completely different shape we do have SP500, which did not even touched the closest support during the correction, shows us that the appetite for new tops is enormous. Making new all time highs is the most probable scenario here.
This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis