SINGAPORE: Spot gold is expected to test a support at $1,209 per ounce, with a good chance of breaking below this level and falling more to $1,194.
The support is provided by the 176.4 percent Fibonacci projection level of a wave C that developed from the Aug. 8 high of $1,322.60. The next support will be at $1,194, the 200 percent level.
So far there has not been any obvious bullish reversal signal to indicate a completion of the downtrend, and chances are this trend may extend further.
Resistance is at $1,218, the 161.8 percent level, a break above which may trigger a further gain to $1,226, the 150 percent level.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
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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