We expect gold to fall further from here, with 1320 and 1300 as initial targets, though the severity of the decline will give us a good indicator of where gold is headed in the medium term. There are a number of potential Elliot Wave scenarios that could be unfolding, as always, and the extent of this correction should shed some light on which scenario is most likely to pan out.
Equities remain in a strong bull trend and the dollar is recovering from a sharp sell off that tested major support below 79 - these are both bearish for gold and the weakness in oil is not helping either, indeed this is suggestive of a general lack of demand for commodities and muted inflation fears.
Support can be found at 1328-1330, 1310, 1300-1305, 1291, 1277, 1260, 1250, 1207 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 as a minimum.
Resistance can be found at 1338-1342, 1352-1355, 1360, 1375, 1400 and 1434. A break above 1434 would suggest a major rally was unfolding with a target of 1525 as a minimum.
Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.