ONG: Gold Weekly Technical Outlook For Sunday January 22nd

Gold's upside momentum as a bit unconvincing as it spent last week struggling around 1650 level. Nonetheless, with 1605.7 support intact, the near term bullish outlook remains unchanged. That is , fall from 1804.4 should have completed at 1523.9 already. Whole fall from 1923.7 might be finished too. Further rise is expected to 1767.1 resistance. Break will affirm this case and target 18044 and above. However, break of 1605.7 will dampen this bullish view and flip bias back to the downside for another low below 1523.9 instead.

In the bigger picture, price actions form 1923.7 high are viewed as a medium term consolidation pattern only. Current development is slightly favoring the case that such consolidation is finished with three waves down to 1523.9. Sustained trading above 55 days EMA will affirm this case. Further break of 1804.4 will indicate that the long term up trend is resuming for another high above 1923.7. In case of another fall, we'd continue to expect strong support from 1478.3/1577.4 support zone to contain downside to finish the consolidation and bring up trend resumption eventually. However, sustained break of 1478.3 indicates that deeper correction is to be seen through 38.2% retracement of 681 to 1923.7 at 1449.

In the long term picture, with 1478.3 support intact, there is no change in the long term bullish outlook in gold. While some more medium term consolidation cannot be ruled out, we'd anticipate an eventual break of 2000 psychological level in the long run

Comex Gold Continuous Contract 4 Hour, Daily, Weekly and Monthly Charts


Gold Trend Forecast for the 1st Quarter of 2012