The Gold price steadies above 1450 after two failed attempts to break below it. The following Gold Elliott wave analysis looks at what could happen next.
November 28, 2019 | AtoZ Markets – Gold dipped to its two weeks low when it attempted to break below 1450 on Tuesday. However, a sharp recovery to 1462 quickly followed. There was another retest of the 145x region on Wednesday but the support at 1450 continued to hold. On Thursday, the price has seen a bit of stability so far. However, the short-term bias seems to be to the downside.
The yellow metal has continued the decline this week as a preliminary trade deal between the US and China gets close. The teams of negotiators of the two parties have reportedly been in talks. US President on Tuesday said the first phase was in the ‘final throes’. Risk appetite is back. Therefore, the demand for Gold and other risk-off assets is on the decline. US and Asian equities markets are making new record highs while the USD surges.
However, despite having a bearish outlook from the trade-talk perspective, the Gold price chart is still coated with uncertainties. There are still fears that a breakdown will happen despite the trade-talk optimisms. President Trump has signed the Hong Kong bill supporting protesters thus going against Beijing’s wishes. China has condemned the bill and threatened to ‘firmly counteract’ if the US continues to be tough. All these will only hike the doubts in the market.
Gold Elliott wave analysis
The gold price started what could be the last leg of the bearish correction from 1557. In the last update, we looked at the possibilities of a zigzag or double zigzag corrective pattern. From 1517, we started counting what could either be a zigzag or impulse wave pattern as the chart below shows (All charting tools are from TradingView).
After the break below the corrective channel, we expected a bearish impulse wave leg from 1479 to break below 1456 to 1442 and potentially 1420-1400 support zone. The new chart below shows the new Gold Elliott wave analysis update.
The chart above shows the bearish impulse wave gradually emerging. The 4th wave ended at 1463. We will most likely see a break below 1450 to the 1442 bearish target level before a big bounce.