Gold price has broken below the $1,260 support and is now heading lower. The trend is down. Prices are moving lower without being able to stage a considerable bounce upwards. Price is below Ichimoku cloud in our time frames. Price is heading towards our target of $1,240. Any possible bounce will find resistance at $1,265-70.
The triangle break out was clear and we took a short position according to the plan. We warned several days ago that volatility was expected to rise because the tightening range of the triangle was about to see a break out. Price has broken the triangle and we followed our plan. We remain short targeting $1,240. I expect a bounce to come from $1,240. Short-term support is at $1,238-$1,228 and short-term resistance is at $1,270 and $1,290.
If Gold price is making a bigger triangle pattern, then we should expect to see another bounce upwards near $1,240, maybe towards $1,330-40. If however we are not inside another bigger triangle, we should expect price to reach $1,200-$1,180 support. In the longer term we remain bearish and expect Gold to fall towards $1,000. However I prefer to close half of positions near $1,240 and lower my stop for the rest of my positions to protect profits.
