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GOLD: Potential bull flag pattern

Since the start of the year Gold increased 6.55% and is in an accumulation phase as demand for a safe haven rose due to the combination the downgrade of the growth forecast for 2015 by the International Monetary Fund (IMF), the an unexpected unpegged of the Swiss franc, from the Euro and the Greek radical far-left, anti-austerity Syriza party that just took control of the government.

Today on the economic agenda we have ADP employment Change in January from the U.S that is expected to fall from 241K to 225K and we will also have the ISM Non-Manufacturing PMI in January that is estimated to rise from 56.2 to 56.3.

Gold initially rose but found enough selling pressure on a daily resistance that forced prices back down to the 200-day moving average, closing in the red near the low of the day. The precious metal made a wide range day and is creating a potential bull flag.

Expecting upward move a daily resistance at 1,268.42 on a bounce from a daily support at 1,244.96 (scenario 1) or a break above the downward trend line could push the commodity to a key level at 1,307.45.