Despite edging higher to 1170.7, the subsequent reversal and short fall on Friday sent gold below 38.2% retracement of 1084.8 to 1170.7 at 1137.9. Such development suggests that rise from 1084.8 has completed. More decline would be expected initially this week to 61.8% retracement at 1117.6 and below. On the upside, break of 1170.7 is needed to confirm rally resumption. Otherwise, short term outlook will be neutral at best.
In the bigger picture, as noted before, the lack of impulsive structure of the rise from 1044.5 so far suggests that it's the second leg of the whole consolidation pattern that started at 1227.5. At this moment, there is no confirmation that rise from 1044.5 is completed yet and another rise might still be seen. However, even in that case, strong resistance should be seen above 100% projection of 1044.5 to 1145.8 from 1084.8 at 1186 to complete the rise and bring the another fall to retest 1044.5 before consolidation fro 1227.5 completes. Meanwhile, break of 1084.8 support will indicate that the third falling leg has likely started and will then target a new low below 1044. before completing consolidations from 1227.5.
In the long term picture, rise from 681 is treated as resumption of the long term up trend from 1999 low of 253 after interim consolidation from 1033.9 has completed in form of an expanding triangle. Next long term target is 100% projection of 253 to 1033.9 from 681 at 1462 level. We'll hold on to the bullish view as long as 931.3 structural support holds.....Comex Gold Continuous Contract 4 Hours Chart.
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