26.08.201315:24 Forex Analysis & Reviews: Gold Elliott wave analysis for August 26, 2013

We were long on Gold from the 1,370.00 as support was held. The price formed a bullish pattern that was confirmed when 1,375.00 was broken upwards. Our first target of 1,390.00 was reached last Friday and the price continued to move higher towards 1,405.00, which was the second important resistance. The trend remains upward. The price is pulling back correctively and we expect another upleg towards 1,410-20.00 to be seen soon.

In case the bullish trend continues and pushes the prices higher, support is at 1,375-65.00 and should hold the price. We will have the first bearish signal when the price falls below the first short-term support level of 1,380.00. On the other hand, the bulls will hope for a break above 1,400.00 as it will signal that the short-term uptrend is resuming and the price will test the 1,410.00 level.

Resistance is important in the price range of 1,400-1,422.00. This is a critical price range that could cause the longer-term trend. It is very possible that if 1,370.00 is broken we will see a pullback towards 1,300-1,310.00. The bulls need to be very cautious as the upside potential is weak and the possibility of stronger correction is rising. Stop for bulls is at 1,380.00. If the price moves back up from 1,400.00 then 1,410-20.00 is sell target.