Technical Outlook For Gold - Daily

Gold's fall from 1227.5 has resumed and the precious metal has broke 1110.2 and reached as low as 1097.7. Intraday technical analysis suggests more downside, with the next target near the 50% retracement of 931.3 to 1227.5 at 1079.40 . On the upside, there is 1142.9 resistance, and if this is broken then a short term bottom may be formed and bring stronger recovery towards testing the highs.

In the bigger picture, rise from 681 has good possibility of developing into a of five wave sequence (popular pattern for technical analysis , Elliot Wave) with first wave completed at 1007.7, second wave triangle consolidation completed at 931.3. Rise from 931.3 is treated as the third wave and has possibly completed at 1227.5 after missing 100% projection of 681 to 1007.7 from 931.3 at 1258.

A deeper pull back from the current levels will test the 1026.9 - 1072 support zone (should provide a good medium-term buying opportunity for a bounce off support and resumption of the uptrend for fifth wave completion), or even further to retest 1000 psychological level. But downside should be contained above 931.3 support and bring up trend resumption. If this is indeed an elliot wave pattern for gold then gold prices shall not fall below the 1,010 support mentioned above (end of first wave) before reaching a new high for the fifth wave, which is currently projected to reach the 1,250 - 1,300 level. Daily indicators have yet to show significant enough divergence to suggest a trend change, and there is multitudes of support coming in slightly below Golds current levels, with these two factors in mind Gold may soon provide a nice buying opportunity for investors of all time frames.

Comex Gold - 4 Hours Chart

Comex Gold - Daily Chart