Gold is clearly starting to develop a new bullish trend; however, this does not preclude the possibility for the emergence of interim corrections along the way.
The price action is currently drawing near to the descending trend line (in purple) and the 200-day MA (in orange). Given the significance of the two as major turning points, the price of gold seems very likely to rebound from 1850.00, thereby initiating a minor correction. This is further supported by the fact that gold managed to break out above the 38.2% Fibonacci retracement only today, and the breakout is not yet certain.
A potential dropdown could fall as low as the 23.6% Fibonacci (around 1770.00) before the commodity finds the necessary support.
The long term target for the newly emerging uptrend remains the same - the 61.8% Fibonacci at 1917.50
The price action is currently drawing near to the descending trend line (in purple) and the 200-day MA (in orange). Given the significance of the two as major turning points, the price of gold seems very likely to rebound from 1850.00, thereby initiating a minor correction. This is further supported by the fact that gold managed to break out above the 38.2% Fibonacci retracement only today, and the breakout is not yet certain.
A potential dropdown could fall as low as the 23.6% Fibonacci (around 1770.00) before the commodity finds the necessary support.
The long term target for the newly emerging uptrend remains the same - the 61.8% Fibonacci at 1917.50