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Play the Range in Gold: Pro

Bart Sadowski | E+ | Getty Images

Gold is in a holding pattern.

Gold rallied nearly $30 from the lows on Tuesday, running stops just above $1,397 and testing $1,401. The rally definitely caught many traders off guard, especially since the market had been grinding lower all morning, reaching as low as $1,372.10.

With the market settling right between the high and the low, the defined range continues to be between $1,364 and $1,397. Gold will truly need to close outside of these levels to pick up any directional momentum in either direction.

The market is beginning to coil up since Tuesday, with lower swing highs and higher swing lows. With light data out of the U.S. on Wednesday, traders can look to cautiously sell against $1,390 and buy against $1,378, measuring risk and looking for an inside day.

Look for a close above or below $1,380 to $1,383.90 to provide some direction into tomorrow's session.

Rich Ilczyszyn is founder and CEO of iiTrader. Follow him on Twitter @iiTrader.

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