01.11.201314:00 Forex Analysis & Reviews: Gold Elliott wave analysis for November 1, 2013

Gold has reached the first target we mentioned yesterday at 1,318, so we can start taking some profits as an upward bounce could be possible at these levels. Short-term support is found at 1,315 and then at 1,300. Short-term resistance level is found at 1,328 and then at 1,334.

Prices have reached the 38% Fibonacci retracement and the decline could continue towards the 50% Fibonacci retracement. The decline is currently in three waves from 1,361; thus is labeled corrective. We prefer to take profits at this price level and at 1,305-1,310. An upward bounce could be possible as well as the entire downward correction. We are now neutral for the short term waiting for prices to unfold and give us more data on what to expect next.

The daily chart continues to form the right hand shoulder. Prices are breaking below the MA and if prices continue towards 1,290-80, then it will be very possible to see a test of the Head-and-shoulders neckline at 1,260-50. If this neckline breaks, we expect prices to see 1,140. If prices make a new short-term high above 1,361, then we should expect Gold to reach 1,430.