With Gold resuming its primary downtrend, a sell-swing provided a great short-selling opportunity.
However, Gold (and GLD) successfully achieved a key short-term support target.
Let’s update our Daily Gold (GLD) Charts and pinpoint this key planning level:
Gold is in a Primary and Intermediate (Monthly and Weekly Chart) Downtrend and we’re seeing a counter-trend retracement (“ABC” so far) into $1,200 on the Daily Chart.
Price successfully achieved our $1,200 target and then traded sharply lower, also as was logically planned.
Note the confluence – and reversal candles – at the 50% Fibonacci and $1,200 “Round Number” Resistance.
A new short-term “Rising Range” or “Bear Flag” style pattern has developed as drawn above (black).
Price successfully traded sharply lower toward our new target near $1,130.
Bears may look to take profits into this support target (lower Bollinger Band and trendline) and buyers may look to put on aggressive “bounce” trades off this key pivot.
However, a breakdown here under $1,130 suggests the higher timeframe downtrends are overpowering the short-term retracement and that price would likely continue falling toward the $1,100 or $1,080 downside targets.
Either way, view today’s touch (test) of $1,130 as the key short-term bull/bear pivot for Gold.
Here’s the similar picture on the popular ETF (symbol GLD):
We look to trade IN the direction of prevailing trends – not against them.
Gold has been downtrending as evidenced by lower price lows and lower price highs along with the bearish orientation of the moving averages.
The similar levels for GLD are the $113.00 per share resistance and the current $107.50 level near $108.00.
A breakdown here – meaning a failure for buyers to hold support successfully – triggers another sell-swing expectation lower toward $103.00.
OTherwise, a support-bounce that triggers above $108.00 per share targets $110.00 then perhaps as high as $113.00 to continue this rising rectangle retracement.
For more daily updates from Corey, visit his blog at Afraid to Trade.com.