Gold Weekly Technical Outlook

Oil N' Gold Team from Oil N' Gold at 11/07/09

Comex Gold (GC)

Gold resumed the long term up trend last week and surged to as high as 1101.9 so far. While intraday upside momentum is diminishing a bit, further rise is still in favor as long as 1084 minor support holds, towards next fibonacci target of 61.8% projection of 681 to 1007.7 from 931.3 at 1133.2. On the downside, though, below 1084 will turn intraday bias neutral and bring pull back, possibly to 4 hours 55 EMA (now at 1071.4) before staying another rise.

In the bigger picture, the long term up trend in Gold is still in progress. Rise from 681 would likely develop into another set of five wave sequence with first wave completed at 1007.7, second wave triangle consolidation completed at 931.3. Rise from 931.3 is expected to extend to 61.8% projection of 681 to 1007.7 from 931.3 at 1133.2 first and then 100% projection at 1258 next. On the downside, break of 1026.9 support will suggest that a short term top is formed and bring consolidation. But we'll hold on to the bullish view as long as 931.3 key support holds.

In the long term picture, as discussed before, rise form 681 is treated as resumption of the long term up trend from 1999 low of 253 after interim consolidation from 1033.9 has completed in form of an expanding triangle. The strong break of 1033.9 resistance affirms this case and should pave the way to 61.8% projection of 253 to 1033.9 from 681 at 1160 and then 100% projection at 1460 level. However, break of 931.3 support will indicate that medium term rise from 681 has possibly completed. This will also open up the case that long term consolidation from 1033.9 is not completed yet and has just started the third falling leg.

Comex Gold Continuous Contract 4 Hours Chart