SINGAPORE: Spot gold may revisit its Nov. 23 low of $1,727.50 per ounce, as a bounce from this level has ended around a resistance of $1,757. The bounce was driven by a wave B, the second wave of a three-wave cycle from $1,786.35.
This wave is expected to be reversed by the current wave C.
Following its two failures to break $1,757, the metal is unlikely to make its third attempt.
A break, however, could lead to a gain into $1,764-$1,772 range.
On the daily chart, signals are a bit neutral as gold is consolidating in the range of $1,721-1,788.
The bias is towards the downside, not only because the more sensitive readings on the hourly chart suggest a drop, but also because the pattern between July 2020 and July 2022 looks like a double-top.
This is a very bearish pattern. It will indicate a target of $1,300 once confirmed.
The bounce from $1,613.60 looks like an extended pullback towards the neckline.