Dear Traders,
Gold has been in a very tight range throughout several weeks now. What can we glimpse from the latest price action? Is a break or bounce imminent? Today’s post will provide an updated wave and technical analysis.
It is difficult to derive much clarity from a wave perspective. The picture remains the same as it has been over the last few weeks. Price most likely produced a complete impulse into the May 21 low, but this could still fit into both, a bullish or bearish scenario. Price action since the May 21 low has undoubtedly been unfolding via 3-wave swings in both directions. This normally indicates correctiveness, and therefore a bearish continuation. The chart above shows the possibility of another bullish swing within wave Y (yellow), before a potential bearish break might occur. Wave Y could also continue to contract and end in a triangle, which would produce a strong bearish break sooner.
The alternative is that we could be seeing a bullish leading diagonal in the making, but any substantial evidence for this idea is not yet available and is therefore not shown on the chart.
From a technical point of view, Gold is looking very bearish:
All in all, my view remains bearish, in spite of yet another potential retest of the 1307 – 1312 area. The chart will need to be reviewed if and when price reaches these levels. There are no trade setups present right now.
All the best along your trading journey
Hubert
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