Gold price broke through the $1,200 support yesterday and declined towards $1,180-$1,170 as expected. We are now at the final stages of the decline in gold prices as this will mark a similar low of high importance as the $1,045 low.
Blue lines - wedge
Gold price has reached the $1,180 level which is a long-term support. This level price was broken out of that old resistance and turned into support as it was back tested in mid 2016. Gold price is now back at this area. I remain bullish on gold in the longer term and I believe that gold price below $1,200 is a gift for bulls.
Green line - trend line resistance
On a monthly chart we can see a rise from $1,045 stop right at the green trend line resistance and the monthly Ichimoku cloud. Gold has now retraced almost 61.8% of the entire rise. This is an important Fibonacci level of support. I expect gold to reverse from current levels to the upside and eventually break the green trend line and reach the upper cloud boundary near $1,500. This is the level to be place buy trades.
