Gold Weekly Technical Outlook For Sunday August 15th

Gold managed to extend the rebound from 1155.6 after brief consolidations. Short term outlook will remain bullish with 1192 support intact and further rise would be seen to 61.8% retracement of 1266.5 to 1155.6 at 1224.1 and above. However, we'd maintain the view that rebound from 1155.6 is merely a correction in the larger decline from 1266.5. Hence, we'd focus on reversal signal as gold enters into 1224.1/1266.5 resistance zone. On the downside, break of 1192 will suggest that rebound from 1155.6 is completed and will flip bias back to the downside to resume the fall from 1266.5.

In the bigger picture, while the rebound from 1155.6 is strong, there is no change in our bearish view. That is rally from 1044.5 should have completed at 1266.5. More importantly, whole medium term rise from 681 should have finished with five waves up too, on bearish divergence condition in daily MACD. Whole fall from 1266.5 is expected to resume sooner or later to 1044.5 cluster support (38.2% retracement of 681 to 1266.5 at 1042.8) at least. After all, we'll stay medium term bearish in gold as long as 1266.5 resistance holds.

In the long term picture, we're proposing that 1266.5 is an important medium term top in gold and we should see a sizable correction going forward. A breach of 1000 psychological level is possible. However, there is no indication of long term up trend reversal yet. We'd maintain the long term bullish view and expect whole up trend from 1999 low of 253 to continue to 100% projection of 253 to 1033.9 from 681 at 1462 level after completing the correction from 1266.5.....Comex Gold Continuous Contract 4 Hour, Daily, Weekly and Monthly Charts.

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