Technical outlook and chart setups:
Gold is trading lower for the day at $1,260.00 levels at this moment, looking to pullback higher at least towards $1,273.00 level. The wave structure indicates that a meaningful top was formed at $1,315.00 level earlier and the drop since then has unfolded into 3 waves as depicted here. If the yellow metal is seen reversing again from $1,273.00/74.00 levels (which is the projection of wave 4), and manages to print lower lows; an impulse 5 wave structure would be ready and confirm that the metal is setting up for a deeper correction. If the above wave count holds true, the metal should not exceed $1,315.00 levels going forward. It is recommended to book profits on short positions taken earlier and remain flat for now. We shall wait for a bearish reversal to again enter short positions. Immediate support is seen at $1.235.00/40.00 levels, while resistance is at $1,315.00 levels respectively.
Trading recommendations:
Please book profits on short positions taken earlier and look to go short at $1,273.00/74.00 on a bearish reversal, stop at $1,320.00, a target would remain open.
Good luck!
