Gold price yesterday broke below $1,310 but this was a fake break as we found out later. Price bounced back up towards $1,325 highs but got rejected and now is trading back below $1,320. The sideways consolidation continues. The trend is neutral. Ichimoku cloud support is getting closer. There is increased probability to see $1,335-45 if resistance at $1,326 is broken.
Short-term support is at $1,310 and if this support fails, we should move towards $1,290 where the Ichimoku cloud is now. As long as we trade below $1,326 I believe we can see a move lower towards $1,290. I believe we are in the final stages of the upward move from $1,240. We have no sell signal from technical analysis yet, but my wave analysis suggests we are close to completing wave E and a sharp downward reversal will come.
Our initial target for wave E to complete is $1,330-40. This target is still valid and we could still reach that level. My longer-term view remains bearish as I expect once the corrective triangle wave 4 ends, we should anticipate a new downward move to new lows.
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