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Gold Coiling - Awaiting NFP

After rallying from about 1168 to about 1307, gold put in a price top, fell below rising trendline, and started to coil into a descending triangle.

Gold 4H Chart 2/6

(click to enlarge)

With the NFP ahead, it is not surprising to see gold priced in the usd, xau/usd, lose direction and volatility.

If gold falls below 1250, there is downside risk, but this bearish outlook should be limited to 1200, a psychological level that is also reinforced by a couple of rising speedlines from November. 

To the upside, a break above 1285 should revive 2015's bullish mode, and push towards 1307 with risk of breaking towards the next resistance around 1320 and then 1345. 

Gold Daily Chart 2/6

(click to enlarge)

A bullish reaction is likely to sustain if the NFP disappoints and posts a print around 200K or less. A bearish reaction will have more chance of making it to 1200 if the NFP surprises with a reading above 250K.