Gold price remains above the $1,250 price level consolidating near the 38% Fibonacci retracement of the decline from $1,301. Gold price has short-term support at $1,245-40 and short-term resistance at $1,257. Short-term trend is still downwards, but it is very possible to see another leg upwards equal to the first from $1,240 that would push the precious metal towards $1,280.
Important support is found at $1,240. If broken we should expect Gold price to test $1,220-$1,200 support area. The short-term chart shows how Gold price is challenging the Ichimoku cloud. Moving inside the cloud will turn trend from down to neutral and could push Gold price towards our target of 50% Fibonacci retracement where the top of the cloud is now.
On a daily basis, Gold price could have formed a longer-term A-B-C-D parts of a large sideways triangle. This is another reason why I think we have seen a short- to intermediate-term bottom. If the low is in, we should expect a larger upwards move as part of wave E of the triangle. The target now is $1,330-340. An important signal that will confirm such a scenario will be if Gold price breaks above $1,290. So we see how crucial our target of $1,280-90 is, as mentioned above. The longer-term outlook for Gold is bearish, targeting a price near or even below $1,000.
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