Written by Oil N' Gold | Sun Sep 13 09 01:50 ET
Comex Gold (GC)
Gold's rally extended further to as high as 1013.7 last week, and took out 1007.7 resistance as expected. Short term outlook will remain bullish as long as 983.2 support holds and further rise is expected to 1033.9 high. Break will target 61.8% projection of 681 to 1007.7 from 931.3 at 1133.2. On the downside, break of 983.2 will indicate that a short term top is formed, possibly with bearish divergence condition in 4 hours MACD. In such case, deeper pull back could be seen to 931.3/974.3 support zone before resuming up trend.
In the bigger picture, rise from 681, which is tentatively treated as resumption of long term up trend, should have resumed after triangle consolidation from 1007.7 has completed at 931.3. Having said that, current rally from 931.3 should extend beyond 1033.9 high to 61.8% projection of 681 to 1007.7 from 931.3 at 1133.2 next. On the downside, break of 931.3 support is needed to be the first signal that Gold has topped out in medium term. Otherwise, outlook remains bullish even in case of deep pull back.
In the long term picture, long term rally from 1999 low of 253 turned into consolidation after completing a five wave sequence to 1033.9 in 2008. Such consolidation from 1033.9 should have completed in form of expanding triangle to 681 already and rise from there is tentatively treated as resumption of the long term up trend. Sustained break of 1033.9 should confirm this case and target 61.8% projection of 253 to 1033.9 from 681 at 1160 and then 100% projection at 1460 level.
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