Gold Eyes 1395 Pending Break Above 1378

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Simple Moving Average( SMA ) 50-period (red), 200-period (bold, gray)
RSI-14 with Simple Moving Average 5-period of RSI attached.

Fibonacci Study
Elliott Wave Principles
Market and Price Action (patterns, candlesticks)
Intraday pivots and Intermediate-term support and resistance

Multiple Time-frame Analysis

Gold's Corrective Wave Count to Complete at Fibonacci Cluster (2/15)

Gold (XAU/USD)
Gold 2/16/2011

- We mentioned yesterday that we are in a corrective rally in gold, but the structure is not clear, and a bullish wave count is valid as well.
- The momentum is bullish in the 1H chart where the RSI shows a bearish divergence, and the price action has flattened out, but another bullish attempt is pending as the RSI remains above 50, reflecting strength in the near-term.
- The 4H RSI shows the market is a rising wedge, or it could be a channel if price action accelerates.
- In the larger perspective, we are in a ranging market (after a bull market), so now that gold has returned to 61.8%, and 78.6% retracement of recent declines, we should expect some resistance soon.
- The the current resistance pushes a decline below 1350 , we are looking at a decline towards 1309 . However, if the market is strong, it should stay above the 1360 area, middle of the most recent consolidation zone, while pushing to higher pivots.
- A bullish scenario would be a rally towards the 1394 area, which could be followed by a correction decline back tow test the 1350 area.
- The 1H chart shows a pattern breakout target of 1395 , and the 4H chart shows a pivot at the 1394 area, so this will the target for the rally, and a place where the market see resistance.
- This bullish outlook requires at least a  close in the 1H chart above 1378 .
- Otherwise, we could be heading back down to test  the 1350 area.  Yes, very unclear bias since we are in the middle of a range.

Has Gold returned to the bulls, or is the consolidation period going to extend longer? We would love to hear what you think.

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Fan Yang CMT
Chief Technical Strategist

 



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Commodities

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