GOLD: Monthly and Weekly: 28.02.2021

In my previous several posts I mentioned that “The Monthly, Weekly and Daily candles are aligned in a way that if any of them are closed below the November low – 1767.20 – during the next week, a further, possibly a multi-month downtrend would be confirmed. The closure on Friday – the end of week and month – would definitely be crucial.”

Today gold made the very convincing prints on all time frames, well below the determined level of 1767.20. There are multiple technical indicators and events that support the hypothesis that gold is going down. Let’s just list them:
1. Price continues to stay below 8 EMA; rejected once at 20 EMA.
2. RSI continues to decline after hitting 82 in August, 2020.
3. Monthly PSAR is on the dark side.
1. Bearish weekly 8/20 EMA cross, the distance between 8 and 20 increases.
2. Price continues below 20 EMA.
3. This week 20 EMA crossed below 50 MA.
1. The most bearish alignment of moving averages: 8/20/50/100/200.
2. Death cross 2 weeks ago: 100/200.
3. Bearish 8/20 EMA cross is in effect.
4. RSI touched the oversold line. This could be a first harbinger of a reversal though.

As you can see on the Mid Term Forecast chart, the price touched the rectangle area that I identified as a possible target for the end of correction. However, taking into consideration the very bearish combos of candles on every time frame, I would be expecting further downturn. From the perspective of Elliott Waves, the final wave of the correction is yet to be seen – this also supports the hypothesis of a continued southbound move. While gold could temporarily bounce to 1760-1790 area, I am expecting it to target 1640-1440 area in this correction, the targets that I identified in the middle of August 2020 in the Very Long Term chart. The chart has not changed and I am re-posting it for your reference.

Good luck with investing!

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