XAUUSD (1297.36): Gold prices reversed losses on Friday as price action resulted in a strong bullish candlestick by Friday’s close. The reversal comes following the past three sessions which saw gold prices closing with a doji candlestick pattern. On the 4-hour chart time frame, gold is seen posting a hidden bearish divergence with the higher highs in the Stochastics resulting in a lower high in price. This predicts that price could correct to the downside in the near term. The recently breached resistance level at 1290.30 is likely to be retested in the near term for support. A rebound off this level will signal further gains to the upside. Gold is likely to target 1305 – 1306 level with the potential to correct towards 1321 – 1318 level.
