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The sharp drop during the previous trading session is labelled as a wave "v", the final wave of a five-wave cycle.
Even though the metal failed to bottom around $2,363.25, it could be too early to assume a short-term downtrend has resumed.
Instead, the break below the Aug. 9 low could be a bear trap, the confirmation of which will be when the contract stands firm above $2,370.
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.
Copyright Reuters, 2011