Gold continues to trade sideways after a leg up from $1636 to $1666. Prices now trade near resistance and previous highs level, and we believe prices--if they manage to break the resistance--will try to first reach $1684 after which, 1702 would be likely.
As mentioned in a previous post, Gold made 5 waves up, followed by the sideways correction. At least 5 more waves up are expected and that is why we give this bullish scenario a better chance.
Prices are expected to extend as much as the first upward move from $1636 or 1,61 times that move ($1702). Bullish positions should be reconsidered if $1653 is broken downward.
The correction has lasted long enough relative to the initial 5 upward waves, therefore prices should now start a new impulsive wave upwards. Stalling or weak prices will be a sign of buyer inability to push towards the extension targets.
In conclusion, if prices move above resistance or pull back and hold support at 1653 (wave ii of new impulsive move), they are expected in the near future to extend as much as the first wave up (1636-1666) towards 1684. Next target will be the 1,618% extension at 1702. Reconsider positions if support is broken at $1653.
Disclosure: None of the information or opinions expressed in this blog constitutes a solicitation for the purchase or sale of any security or other instrument. Nothing in this article constitutes investment advice and any recommendations that may be contained herein have not been based upon a consideration of the investment objectives, financial situation or particular needs of any specific recipient. Any purchase or sale activity in any securities or other instrument should be based upon your own analysis and conclusions.
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