Gold Technical Analysis and Near-Term Outlook
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February gold’s pullback from $4584 looks like it is a completed correction. The $4286 XC (2.764) projection of the first wave down from $4584 and the 38 percent retracement of the rise from $3933.2 held on a closing basis. The subsequent rise fulfilled the $4500 intermediate (1.382) target of the wave up from $4284.3 and settled above the 62 percent retracement of the decline from $4584. Most recently, the 38 percent retracement of the rise from $4284.3 held and prices rose above the $4478.4 corrective swing high, invalidating the prior primary wave down from $4512.4.
Gold is poised to test $4500 again. Settling above this will call for the $4532 larger than (1.618) target of the wave up from $4284.3 and the smaller than (0.618) target of the wave up from $4319.7. Closing above $4532 will clear the way for another test of the $4563 intermediate target of the first wave up from $4302.8 and likely a new high of $4615.
Based upon the current wave structure, key support for the near-term is the $4327 smaller than (0.618) target of the wave down from $4584. Should prices fall again and take out the $4426 smaller than target of the new wave down from $4512.4, look for a test of $4394, $4362, and possibly $4327. Closing below $4327 will shift the near-term odds in favor of gold falling to $4259 and eventually the $4212 equal to target of the wave down from $4584.
