Technical outlook and chart setups:
Gold has reversed from $1,337.00 levels yesterday, exceeding our projection, but the metal could not break above the $1,343.00 resistance levels. The metal seems to have now terminated its counter-trend rally and should resume its trend lower towards $1,171.00 levels. A meaningful top is now in place at $1,337.00 levels and the metal has also completed its first wave drop at $1,270.00 levels yesterday. The metal is trading at $1,278.00 levels for now and should be looking to push higher in a counter trend rally towards $1,310.00 levels (wave 2). The wave structure also indicates that the metal is poised for a lower drop unfolding into 5 waves, which wave 1 looks completed. It is recommended to remain flat for now and prepare to initiate short positions. Immediate resistance is now seen at $1,337.00 levels, while support is at $1,267.00 levels.
Trading recommendations:
Prepare to go short around $1,310.00 levels; stop is at $1,345.00; targets are $1,200.00 and $1,171.00 levels.
Good luck!
