FX.co ★ Gold wave analysis for July 18, 2014

In yesterday's post I mentioned that I was expecting Gold price to move towards th 61.8% Fibonacci retracement as 5 waves down were complete and 3 waves up were expected. 3 waves up has followed and price has reached the 61.8% Fibonacci retracement.

Gold price is moving according to our plan. The 5 wave decline is followed by a 3 wave upward move and I now expect at least one more 5 wave decline that will bring Gold price below $1,290 and towards the long-term important support level at $1,270 where the big triangle boundaries are found.

Breaking below $1,270 will increase the chances of our bearish scenario where we expect price to fall towards $1,000 as wave 4 is complete and wave E of the triangle has ended at $1,346. I remain bearish as long as we trade below $1,346. Short-term resistance is found at $1,330 and support at $1,305.