Gold today tried to start a rally, however it ended right under the 8d EMA line. As the result, it got a bearish 8/20 EMA cross – one more reason to be bearish. Let’s explore the hypothesis from different angles.
Gold today made a Piercing Line combo. It would be viewed as a good bullish one, but it was not supported by indicators this time. The price did not break over the 8 EMA.
As I type this ($1803), a bearish candle is forming for tomorrow (though it does not mean it ends like this) and the price on the weekly and monthly charts moved below 8 EMA respectively. This is viewed as a strong bearish action.
If the move down continues, gold has a chance to break below 50d MA.
My projection of a possible wave that I charted a few days ago remains intact. The blue count is primary. The red – alternative.
- Remember that gold was damaged greatly in June on the monthly and weekly frames. The long-term odds are still on the dark side.
2. The operative target for wave iii (blue) – $1755-1770. Timing – 2-5 days.
3. If this week (tomorrow) closes below $1791, the weekly candle would confirm a bearish reversal on the weekly frame.
The longer term forecast and targets were discussed in details in the Monthly Analysis (link below).
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