Spot gold may drop into $1,796-$1,816 range
- On the daily chart, a projection analysis reveals a similar resistance at $1,853, the 50% level of a downward wave C from $1,965.33.
SINGAPORE: Spot gold may drop into $1,796-$1,816 range, as it failed to break a resistance at $1,847 per ounce.
The resistance is identified as the 61.8% retracement on the downtrend from $1,898.81 to $1,764.29. It is a key level to evaluate whether the trend could be totally reversed.
A break above $1,847 will not only lead to a gain to $1,867 but also increase the chance of a total reversal of the downtrend.
However, the chance looks slim, as gold has lost its momentum around $1,847. Most likely, the metal would break $1,832 and fall into $1,796-$1,816 range.
On the daily chart, a projection analysis reveals a similar resistance at $1,853, the 50% level of a downward wave C from $1,965.33.
The daily white candlesticks from Dec. 1 have become smaller, with a doji forming on Dec. 4.
These patterns signal a dissipation of the bullish momentum. Either a correction or a resumption of the downtrend is on the way.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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