A sharp reversal on gold from 1181 suggests that decline from 1267 is completed five wave move, so current upward reaction should be a temporary corrective retracement. Corrections are three wave patterns so be aware of more upside after current wave (b) that could find a support around 1210 area. Swing zone for possible resumption of a larger downtrend comes in at 12677, but after we will be able to count three legs up.

GOLD 4h Elliott Wave Analysis

On daily chart Gold is trading nicely lower since the start of September, after the break through the rising trend line of a corrective channel. We knew at the time that it was an important signal for a change in trend, which means that bearish price action is now back in play which also accelerated at the end of December, so we assume that price is moving down in larger wave 5) heading through 1180 June low. Current bounce is probably just another sub-wave rally in the middle of a bearish trend. Resistance is seen around 1250/1270 from where new sell-off could occur, but after three legs.

GOLD Daily Elliott Wave Analysis

On Intraday chart GOLD is moving sideways for the last 24-48 hours, so we assume that price is still heading lower within wave c) of (b) that may look for a support around 1210/08, beneath 1215 spike low and near 61.8% Fibonacci retracement level.

GOLD Intraday Elliott Wave Analysis

Written by www.ew-forecast.com