Gold continued bearish yesterday after completing an important wave pattern.What should we expect next? The following 29 March Gold Elliott wave analysis looks at the technical forecast of XAUUSD based on Elliott wave theory.
29 March, AtoZForex – USD has been strong so far this week . It might be that the strength of USD was the major contributing factor to this week weak Gold position. Aside this, Gold also completed a bullish impulse wave prior to the drop. According to Elliott wave theory, a 3-wave correction usually follows an impulse wave. Impulse wave happen to be the most popular Elliott wave pattern. It’s like the foundation.
In the update before the last, I alerted us about this pattern formed in Gold. The expected bearish move started on Tuesday – 27th March. I suggested selling the pullback for short term traders. Yesterday, there was a slight pullback and price dropped massively. The chart below was used in the last update.
The bearish target was set at 1324. Price is already showing the momentum to believe this will most likely happen. Short term sellers can take advantage by selling the next intraday pullback and ride to 1324 target level. Long term/swing traders can wait for the intraday bearish correction to end before looking for bullish clues. The long term bias is still pointing upside (unless the current drop extends below 1306 support) despite the current drops.
Price has now dropped as expected after a brief pullback. Short term traders would have made good profits from this good setup. What should we expect next? Will their be an opportunity upside?
29 March Gold Elliott wave analysis: what next?
The 3-wave drop happened just as expected. But, the drop could also be likened to an impulse wave in motion. Corrective waves often take more time to complete than motive waves. I will stand aside and wait to see how price will behave in the coming days. The bearish trend should continue if the current dip extends to break below 1306 support. If price stays above 1306, there is still a bullish chance. Stay tuned for the next update.
Do you have other views in contrast to the ones listed or you want to compliment them further? let’s know by your comment below.
Don’t forget to share this analysis with people that matter to you.