Written by Oil N' Gold | Sat Aug 22 09 17:39 ET
Comex Gold (GC)
Gold rebounded strongly after edging lower to 931.3. The break of an inner falling trend line suggests that fall from 974.3 might have completed but 963.1 remains intact for the moment and thus didn't confirm this case. Initial outlook is neutral this week. Break of 963.1 will indicate that corrective fall from 974.34 has completed and further rally should then be seen to retest this high. On the downside, below 939.1 minor support will flip intraday bias back to the downside for 931.3 support first and then 904.8 support.
In the bigger picture, price actions in gold remains choppily bounded in converging range between 865 and 1007.7. Where there are some possible developments inside such range, there is no change in the preferred view that it's merely consolidation to larger rise from 681, and should be near to completion. On the downside, in case of another fall, strong support should be seen at 904.8 support level and the case of deep fall to 865 is not likely. On the upside, break of 974.3 resistance will serve as the first alert that rise from 681 is resuming and will turn focus to 1007.7 key resistance level for confirmation.
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.
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