To begin this week with a positive note, the gold prices have spiked from two days, prevailing at 1150.62 levels but couldn’t sustain to drop back at 1142.94 levels.
But please also be noted that after the intermediate uptrend, gold prices have retraced more than 61.8% slumps from the highs of 1375 to current 1142 levels in the major downtrend.
As the current prices decisively break below 1167 levels, can it be the long-term lower target at 78.6% or even 88.6% Fibonacci extensions, i.e. 1110.26 and 1076.39 which appears to be feasible with the signals of momentum indicators:
If the long-term downtrend remains intact going forward and the 2015 low of $1,046.54 is eventually exceeded to the downside gold could easily reach the 127.2% of the uptrend off the 2015 low. That extension is at $957.16 and is a minimum lower target.
As the current prices are well below EMAs amid mild upswings, more slumps likely as bears break major support at 1167 marks, current prices remaining well below EMAs to bring in more slumps.
and indicators signal the consistent downward convergence that signals the strength in sentiments with intensified selling momentum.
So, our conviction is that more rout on the cards, those aggressive bulls who have been adamantly call for upside targets atleast now identify with the major technical trend.
Well, contemplating these technical reasonings, to participate in today’s swings we bid one touch calls on momentary rallies and stay short in mid-month to participate in the intermediate bear trend.