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It’s been several weeks since I’ve
written about Gold and we have had a wild ride since the 1910-1920 highs in
August. When gold was trading at that lofty price I forecasted a major
correction was nearing. We were shorting gold from $1862- $910 prior to the
huge $208 drop that took place over just a a few days. We covered our short at $1725 and then
Gold rallied back to a double top at $1920 and then fell back to $1531.
That pullback to $1531 qualifies as a Fibonacci
retracement of the 34 month rally from $681 to $1920, and would also qualify
for a price low for a 4th major wave correction that I discussed
in prior forecasts. My initial targets for the Gold pullback were
$1480-$1520 if the $1650 area was violated. Most recently we have seen
Gold run up to 1681 which is another Fibonacci resistance zone a few times
and then back off to the low $1600’s.
With the recent push over $1681, we can now confirm
the 4th wave is over at $1531 lows and that the 5th
wave is likely in the very early stages, but beginning to build steam. I will
say that we want to make sure the 1650-1680’s areas are defended by
Gold on any pullbacks in order for this forecast to remain valid.
During this 5th wave up, eventually we should see the $2380 ranges
in Gold, but it will not take place overnight. In the next few months I
am looking for Gold to attack the $1900 range, possibly even by year end, and
then in 2012 attacking the $2000 plus ranges.
With all of the Macro events in Europe changing on
an almost daily basis, the whipsaws in both the precious metals and equities
markets are difficult to forecast and trade for most investors. However, Gold
has been moving in defined Fibonacci and wave patterns for ten years now, and
has about three years left in a 13 year bull cycle if I’m right.
Below is the updated weekly chart of Gold. You
can see prior low’s as they related to oversold indicators, and where
we just came off the 1531 lows and its Fibonacci pivot along with the
oversold indicators below.
Look for Gold to attack 1775 first, then 1800, 1840,
then 1900 in the coming 6-10 weeks or so.
 
Gold Forecast
David Banister
The Market Trend Forecast
If you’d like to receive free weekly reports,
please check at www.markettrendforecast.com
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