Looking at the Weekly chart of Gold, we can see a descending triangle formation, the base of the pattern has been broken only to reverse back, and now we're getting another breakdown. This is a key moment for the long term gold outlook, if we break the recent lows, the pattern will be officially broken, and as such the basic projection will be a drop to around the $900 per ounce area. This may be a very plausible drop if we get more good data from the US coupled with hawkish fed statements leading to a rate hike in mid 2015. Alternatively, if gold does not break the lows, but rather trades higher, the fake breakout may be construed as a short as a squeeze of the last buyers before starting a big move higher, projection wise towards the 1550 support and resistance area. This scenario is certainly plausible, as the US economy may start to falter in 2015, which may induce the Fed to reverse course back to dovishness and potentially QE4 initiation. Either way, it is an important time to follow gold on a longer term time-frame, so as to assess the direction for the next couple of trading years.
Comments
ShaharyarZafar
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I think it's a downward continuation to at least first target of 1140
pip_drunk
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yea , also believe its downward trend continuation ...
Geert2000
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Descending wedge,its gonna break to the downside.Target 1070
Meysam
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Gold price will increase to 1267 in January or February