Market Cap:
$262.3B
BTC Dominance:
68.52%
btc:
$9984.96
eth:
$186.29
xrp:
$0.26
Advertise
Forecasts

Gold price bounces back toward 1300

Sanmi Adeagbo | Mar. 8, 2019
Gold price bounces back toward 1300

March 08, 2019 | AtoZ Markets - Gold did not break below 1280 this week but has rebounded toward 1300 ahead of the NFP. The following give technical insights based on Elliott wave theory.

The yellow metal in the last two weeks lost its 'safe-haven' edge following a possible US-China trade agreement and a rallying US treasury yield bond. However, the precious metal since Thursday has been gaining bullish momentum toward 1300 after failing thrice to break below 1280. A support zone has been formed at 1280-1285 with a triple bottom price formation. If price builds on it, further rallies to 1300-1302 resistance zone are in the cards ahead of U.S employment data. A better than expected Non-farm payroll will most likely drag the dollar-denominated commodity below the 1285-1280 support zone.

In the last two weeks, Gold has dropped about 4% from 1342. Price breaking away from the near-term support zone of 1280-1285 will only lead to lower prices. A break above 1300-1302 resistance zone, on the other hand, might lead to a climb toward 1325. Gold has gained over 100 pips today but has now gone sideways as traders book profit in anticipation of the NFP. What are the likely scenarios?

Gold Elliott wave analysis and important price levels

The drop from 1346 was anticipated to be the 4th wave of the bullish impulse wave from 1160. This 4th wave, however, is going deeper than expected but still in the confines of the basic tenet of Elliott wave theory. The 4th wave should be corrective but the drop from 1346 looks impulsive and could be the first leg of the bearish correction, which now has the potentials of going even lower. In the last update, we used the chart below to illustrate the 4th wave.

Gold price bounces

Wave a seems to have ended with the current bounce leading to wave b. At the end of wave b, further dips might test the rising trendline at 126x most probably. The chart below looks at the development of the 4th wave. 

Gold price bounces

An impulse wave a seems to have completed from 1246. The current rally is expected to be part of a corrective wave b especially if the NFP came worse than expected. A rally into the 1302-1325 wave iii-iv territory will happen. A better than expected NFP could lead to further dips below 1280. Sellers will look for an opportunity after the 3-wave correction upside completes.

Please share your thoughts with us in the comment box below.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.