FX.co ★ Gold Elliott wave analysis for October 30, 2013

Gold prices managed to make a new lower low at 1,338 just one dollar below the 1,339 low. The current trend is downward in the short term. Prices are expected to continue lower towards 1,320 at least as long as prices trade below 1,353. Short-term resistance is found at 1,353 and the pivot point is found at 1,348. Support is found at 1,338. As long as prices trade below 1,348 there are more chances of the support test. If prices move above 1,348, then the resistance is going to be tested.

The first short-term target of this move that started at 1,360 is the 38% Fibonacci retracement at 1,319. The downward move is not a clear impulsive move yet; therefore, we favor the bullish scenario that implies that only a shallow retracement should be expected after the end of the upward move from 1,250 to 1,360.

The daily chart has not given us anything new to study. Chances of either bullish or bearish scenario are equally shared. Important daily levels to watch out for are the 1,320 and 1,290 support levels and the 1,375 resistance. Concluding, we favor, in the short term, short positions as long as prices trade below 1,353 with 1,320 as the first target.