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Gold: Bulls building case to break higher towards $1,500 - 2ndSkies

FXstreet.com (Barcelona) - Gold continues to correct into higher ground after the blood bath from Feb 12-16, where a malicious selling stampede sent the price from $1555 into a bottomless fall only stalling 4 days later around $1315, a 51-month low.

Ever since, the shinny metal has been recovering its lost allure, building higher highs and higher lows while developing a tight relationship with the 20-ema on the 4-hour chart, until faced with 1480/83 resistance. The metal has been unable to break since the area was first encountered on April 26, having subsequent failures on April 26 only to be kept below $1480 the last few days.

According to Chris Capre, founder at 2nsSkies: "After two knocks on the key $1484 resistance, the precious metal has been climbing steadily, forming a 20ema carry on the 4hr chart. The bulls are slowly attempting to take out the critical resistance above, and their case is building. I’m expecting a terminus of this pattern in the next 24hrs. Bulls can wait for a breakout pullback setup above $1484, while bears can look to sell around this level with tight stops above, targeting $1464 and $1448."

"A clearing of the air above targets $1500, so plays on both sides here, but the FOMC meeting later on Wednesday could provide the extra juice to start the next move" Chris adds.

Forex: EUR/JPY closes slightly higher, support at 127.00 continues to hold

The EUR/JPY closed the day up 12 pips at 128.21, as buyers once again stepped into take advantage of early weakness just above the 127.00 support level. The upcoming European session will be light in regards to economic releases with the European markets closed for holiday. Volatility will no doubt pick up later in the week as we head into the European Central Bank monetary policy meeting on May 2nd at 11:45 GMT.
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