Positive divergence and key day reversal point to short term stabilisation – cover your shorts.
- Our short term gold forecast has been neutralised because of the positive divergence which can be seen on the daily RSI and Monday’s bullish key reversal day as well as the 2008-13 uptrend line at 1225.06 underpinning. Therefore cover at least some of your shorts at current levels.
- The previous 1278.41/1272.56 support zone (61.8% Fibonacci retracement and August low) should, because of inverse polarity, now act as resistance, together with the 50% retracement of the 2008-11 advance at 1301.12 and the 38.2% Fibonacci retracement of the August-to- November low at 1306.47.
- Further resistance can be seen between the 1326.44 November 7 high and the 2013 resistance line at 1327.38.
- Only a, for now unexpected, drop through Monday’s low at 1227.61 will put the 1208.08/1180.04 June/July lows and also the 2008-11 61.8% Fibonacci retracement at 1154.72 back on the map.
Gold Daily Chart
Gold – Weekly Chart
Has slipped through the six month support line at 1278.41 which should now act as resistance.
Gold Weekly Chart
Gold – Monthly Chart
The 2008-13 uptrend line at 1225.06 offers support.