Gold Near-Term Outlook
December gold’s move up today is most likely corrective of yesterday’s decline. Near-term odds continue to favor a larger move down because of the daily and weekly reversal patterns and signals that were confirmed during the pullback from the $2089.2 swing high. A move below $1942 early tomorrow will increase odds for challenging $1932 again. This is the 62 percent retracement of the rise from $1874.2, a close below which will call for $1907 and then the key objective at $1892. Settling below $1892 will call for a much more significant test of support before gold tries to rise again.
Nevertheless, based on the intra-day waves up from $1928.9, there is a good chance for a test of $1975 and possibly $1988 before gold challenges $1932 again. Resistance at $1988 is expected to hold. Closing above this will call for $2011 and possibly $2022. The $2022 threshold is most important because this is the smaller than (0.618) target of the wave up from $1874.2. Settling above $2022 would imply that the corrective move down is most likely complete and that the move up will begin to extend toward new highs again.
This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.
