Technical outlook:
Gold prices dropped through $1,891-92 lows on Monday before finding some support. The yellow metal remained shy by one point to test its previous swing low registered around $1,890. Bears have remained in control since $1,998-99 highs as projected earlier, dragging prices lower by more than 100 points.
Gold prices have extended the last leg beyond our projection around $1,915-19 levels. The yellow metal is now seen to be trading close to $1,904-05 levels and is attempting at least a corrective rally from here. The bottom line remains that prices should stay above the $1,890 mark going forward. If correct, we can expect a rally through $1,930 and $1,960 respectively in the next few trading sessions.
Gold prices seem to have carved a meaningful downswing between $1,998-99 and $1,891-92 levels. The bulls are expected to produce a counter-trend rally up to the $1,960 level, which is the Fibonacci 0.618 retracement of the above drop. A high probability remains for a bearish turn thereafter as the bears come back in control again.
Trading plan:
Potential short-term rally toward $1,930 and $1,960 against $1,890
Good luck!
