SINGAPORE: Spot gold may test a resistance at $1,908 per ounce, a break above which could lead to a gain into $1,917-$1,924 range.
The drop from the April 18 high of $1,998.10 consists of three waves.
The third wave, wave c, seems to have completed around its 100% projection level of $1,894.
The support at $1,894 is strengthened by another one at $1,889.45, the March 29 low. These supports have triggered a bounce which may extend into $1,917-$1,924 range.
A break below $1,889 may confirm a continuation of the downtrend towards $1,870.
On the daily chart, a retracement analysis on the uptrend from $1,779.20 reveals a similar support at $1,890, which contributes a lot to triggering a bounce as well.
It is still too early to predict the outcome of the battle between bulls and bears around this key support.
A triangle pattern seems to be taking shape. It will be confirmed when gold gets out of the $1,890-$1,959 range.