Gold Weekly Technical Outlook

Written by Oil N' Gold | Sat Aug 08 09 05:55 ET
Comex Gold (GC)

Despite edging higher to 974.3 last week, gold has clearly lost upside momentum and turned sideway since then. With 4 hours MACD staying below signal line, initial bias is neutral this week. Another rise is still mildly in favor with 953.0 minor support intact. Above 974.3 will target 100% projection of 904.8 to 962.7 from 927.6 at 985.4 next. But after all, note that price actions from 1007.7 might be developing into triangle consolidation, upside of the current rise will possibly be limited between 985.4 and 992.1 and bring at least another fall to conclude the consolidation. Hence we'd look for near term reversal signals there. On the other hand, break of 953.0 will be the first signal that whole rebound from 904.8 has completed already. Intraday bias will be flipped back to the downside in such case for 927.6 support first and break will confirm the bring deeper decline towards 904.8 low.

In the bigger picture, we're still preferring the case that price actions from 1007.7 are developing into consolidations to larger rally from 681, probably in form of triangle. Hence, another fall should be seen before completing such consolidation but downside will likely be contained by 904.8. The case of deep fall to 865 is not likely. In any case, break sustained break of 1007.7 resistance will indicate that whole rally from 681 has resumed and should target 1033.9 key resistance next.In the long term picture, medium term consolidation from 1033.9 should have completed as an expanding triangle to 681 already. Rise from there is tentatively treated as resumption of the long term up trend from 253 and will target 61.8% projection of 253 to 1033.9 from 681 at 1160 after taking out 1033.9 high. However, a break below mentioned 801.5 cluster support will argue that consolidation from 1033.9 is still in progress and will delay the long term bullish case.