Gold: analysis for December 27, 2013 Trend News

Overview:

Since our last analysis,Gold has been trading upwards, as we expected, the price tested the level of 1,215.53 (FE 100 %) on ultra high volume (buying climax). According to the 1H chart, Gold is in bullish corrective phase, so we placed Fibonacci expansion to find the levels for potential end of the bullish corrective phase. We got FE 61.8 % at 1,205.22 (already broken), FE 100 % at 1,213.15, and FE 161.8 % at the price of 1,225.97. We can also see decreasing volume on upper legs which is good sign for further bearish continuation. Anyway, if the price breaks the area of 1,215.53 on high volume, we may see the testing of FE 161.8 % at 1,225.90, before we start with bearish continuation. Don't forget, Gold is in bearish trend so buying looks very risky. Watch for selling opportunities after the bullish corrective phase ends.

Daily pivot Fibonacci points:

Resistance levels:

R1: 1,213.55

R2: 1,216.19

R3: 1,220.47

Support levels:

S1: 1,204.99

S2: 1,202.35

S3: 1,198.07

Trading recommendation: Trading the metal, be careful with short-term buying and look for selling opportunities after the bullish corrective phase ends.

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Gold analysis for December 27, 2013 Trend News

Gold is in downtrend within a downward sloping trend channel and we believe it currently makes its upward wave 4 bounce as shown in the chart below. Prices are now at $ 1,210 and we believe that the upward bounce is most probably over. Prices are expected to turn downwards towards $1,180 to complete our anticipated wave 5.

Short-term support is found at $1,205 and then at $1,195. Short-term resistance is found at $1,220 and then at $1,240. We expect prices to remain inside the blue downward sloping channel. Prices have reached the upper boundaries of the channel and we expect to see a rejection now that will lead prices lower to complete wave (5).

The daily chart above shows clearly that the trend remains downward. We believe that the move from $1,270 is still not over as well as the move from $1,360. We expect this downward move to end near $1,1150. We remain bearish.

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