WTF Chart of the Day: Gold At Short Term Support
By LawrenceUpdate on gold’s latest failed attempt to move higher.
Mentioned last time that gold has support at 1260 area back in early October.
A bounce followed which was pretty much expected.
Everyone was so bullish back then while my members know that 1360 has to be cleared before any significant upside was possible. Gold simply followed its path of least resistance to backfill the void zone. It is necessary to clean out the weak hands on both sides before a directional move can be made.
Gold tagged the support zone at 1260 again and bounced off perfectly but it is not a sign of long term directional change, yet. Until gold can reclaim 1320 and stay above, gold is more likely to go lower now than going higher. It has accepted this lower price level.
Gold bears don’t be too happy with the bearish bias yet. It will be a tough ride for shorts just like what happened back in September and early October. The spikes up can be very nasty.
Gold may need to retest the flush low later this year (or early next year) to complete the selling process.
