Gold heading for lower lows?
James Chen December 4, 2013 4:35 PM
<p>Gold (daily chart) has shown marked weakness since its $1433 high in late August. From that high, the precious metal dropped down to a low […]</p>
Gold (daily chart) has shown marked weakness since its $1433 high in late August. From that high, the precious metal dropped down to a low of $1251 in mid-October before pulling back up to $1361 in late October, which was the 61.8% Fibonacci retracement of the prior bearish leg.
Since that upside pullback, gold has fallen sharply for the past month on its way towards its major downside objective – the key $1180 level, which was the multi-year low that was last established in late June. A breakdown below $1180 would confirm a continuation of the sustained bearish trend in gold that has been in place since the October 2012 high near $1800. A continued bearish environment should prevail for the precious metal, as the price of gold is well below its 50-day moving average which is, in turn, well below the 200-day moving average. Any strong breakdown below the noted $1180 low could potentially begin to target further downside around the $1000 psychological support level.
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