Watching For A Reversal In Gold
New York (Jun 3) If you are watching for a reversal higher in gold you are not alone. After the run higher off of the December low it had gained more than 25%. But since then it has failed to keep that same momentum to the upside. Falling back at 1278 it found support around 1210 and ran to a higher high, touching 1300.
The round number proved to be too much for gold though. It has now lost nearly $100 since touching 1300 and pushing down through the prior support area. So if you are waiting for that reversal I am sorry to say it may not be coming anytime soon.
The chart above shows the pullback has now almost reached a 38.2% retracement of the Shark harmonic. With the push under the 100 day SMA and the prior support level at 1215 this appears to be the next target. There is prior support below that at 1180 and 1140. The RSI is in the bearish zone and falling, though not oversold. The MACD is also falling and no where near extreme levels. Finally the Bollinger Bands® are pointing and opening to the downside.
Gold may not have a lot of downside left in it, but it seems with Thursday’s action that the downside is still the path of least resistance and the path it will take in the near future.