FX.co ★ Gold Elliott wave analysis for November 2, 2013

Gold has paused its decline from 1,360 to 1,306 (50% Fibonacci retracement). Prices are now trading at 1,314 and the short-term resistance is found at 1,325. Today's pivot point is 1,317. If prices move above that level, then bulls will have increased chances of testing the first resistance level at 1,325. Breaking above that level will push prices towards 1,337. Short-term support is found at 1,305-6 and then at 1,290 (61,8% Fibonacci retracement).

We are cautiously bullish here at 1,314 waiting for prices to make a breakout. This is an area where we can see a bottom in place and a trend reversal. We are bullish on signs of strength. Signs of strength are a break above 1,325 and 1,337. This means that we will open long positions once the resistance levels are broken. Until then, we wait because there is increased probability of another move down towards 1,300-1,290.

The daily chart has not changed at all. The right hand shoulder is being formed and the pattern of head-and-shoulders is still a very possible reality that could push prices towards the neckline at 1,250-60. We remain in favor of this pattern in the daily chart, as long as prices trade below 1,360.