FX.co ★ Gold Elliott wave analysis for October 25, 2013

Gold reached our first short-term target at 1,350 yesterday, and the price did not get rejected at that resistance. Now trading near 1,343 which is our pivot point for today, we favor neutral positions as long as prices trade below that level. If prices trade above the pivot point, then there will be increased chances of making a new high above 1,350. The short-term support is found at 1,336, and if broken, it could lead the precious metal to a bigger decline towards 1,322 and then 1,310.

The supportive upward sloping trend line is being tested now. Prices are slightly below it, and we have to wait in order to reach any solid conclusions. This is the first weakness sign, but we want to wait for more evidence of weakness in order to open short positions.

The trend remains upwards in the short term. If prices remain supported, we could see the continuation of the move towards 1,375. Currently, the trend is upward and a short-term trend change to downward could come if prices break below 1,330. If this support fails, then we could see prices reach 1,310-1,300 or even 1,280. So bulls need to be extra careful around these levels and keep a tight stop loss.