• 7 hours Is $90 Oil Possible? An Interview With Jay Park
  • 1 day Billions Of Dollars Are Flooding Into The Flying Taxi Space
  • 1 day Is This The Most Important Energy Project Of 2020?
  • 2 days Startups Are Dying To Give You A Better Death
  • 2 days U.S. Restaurants Are Struggling With Rising Labor Costs
  • 3 days The Banking Bonanza Is Just Getting Started
  • 3 days How The Trade War Ceasefire Will Impact The Energy Industry
  • 4 days Who Is The Most Dangerous Person On The Internet?
  • 4 days SoftBank Sees First Quarterly Loss In 14 Years
  • 6 days Prepare For An Oil Glut In 2020
  • 7 days Why A Strong Yuan Is A Promising Sign For The Trade War
  • 8 days What Would You Sacrifice For A Debt-Free Life?
  • 8 days Shareholders Urge Major Bank To Stop Funding Fossil Fuel Companies
  • 8 days Tariffs Are Causing A Slowdown In U.S. Manufacturing
  • 9 days The Great Silicon Valley Migration Has Begun
  • 9 days 3 Oil Stocks Paying Out Promising Dividends In 2020
  • 10 days How Fractional Trading Is Democratizing the Stock Markets
  • 10 days Why Smart Money Is Looking To Short Aramco
  • 10 days Gold Major Looks To Hike Dividends By 79%
  • 11 days Three Reasons Precious Metals Are On The Rise
Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Trading On The Mark

Trading On The Mark

Trading On The Mark

Our work is grounded in several technical methods. We make use of Elliott Wave, Gann techniques, Fibonacci relationships in price and time, cycles, and other…

Contact Author

  1. Home
  2. Markets
  3. Other

Gold May Bounce From This Targeted Support Level

On December 12, we noted for readers of SafeHaven that gold appeared to be winding its way through a corrective move, and we suggested two support levels that could produce a bounce - 1668.70 and 1628.10. We also suggested that it was a good time for those wanting to be long gold to step aside, unless they were prepared to trade short.

Chart 1 - Gold's Corrective Move

Last week, gold reached the lower target support level and began an attempt at a bounce. That support level is also near a channel line we have been watching. So what is next?

Gold Reaches Lower Target Support Level

We see three possibilities.

First scenario: (Shown with green labels.) The lows in late May of last year completed a '(iv)' which was followed by wave 'i' of '(5)' up into the early October high and then down into a wave 'ii' of '(5)' which brought price to the present support level. Wave 'iii' up would follow into at least $1900.

Second scenario: (Shown with blue labels.) The high in October was a '(b)' wave, and we have just seen wave 'a' or 'w' of '(c)' of '(4)' complete. This suggests a minor 'b' wave up is due now. Targets for a 'b' wave are difficult to predict without seeing more price action. One rough estimate would be 50% of the last swing, which would be near $1714, but higher would be possible.

Third scenario: (Consistent with the blue labels.) A diagonal has formed, or is in the process of forming, coming down from the October high. At the completion of the diagonal, there would be a 'b' wave bounce, but ideally it would be halted before $1734 to form 'b' of '(c)' of '(4)'.

We lean toward the second scenario, because the advance from the May low looks more like an a-b-c move up rather than a clean impulse. However, a 'i' of a diagonal '(5)' up could make the first scenario work.

Scenario #3 is for all practical purposes similar to Scenario #2.

We should expect bounce for now, unless the trendline breaks.

 


About Trading

If this is the kind of trading information that you can use, consider exploring Trading On The Mark with a month-long discounted trial membership. Just $30 gives you full access to our analysis of stock indices, currencies and commodities on timeframes ranging from months to minutes. It also opens the door for you to join in our live trading room where we identify intraday trading opportunities. TOTM is a source of guidance and a place where you can have your questions answered by experienced traders, and that may be the key to developing a successful trading plan for yourself.

 

Back to homepage

Leave a comment

Leave a comment