Gold Price Analysis: Signs of Weakness Amidst a Bullish Trend

Gold Forecast Video for 13.10.23 by Bruce Powers

Gold pulls back following a bullish trend continuation and successful test of the 1,885-swing low as resistance. Once reached gold began to fall and continues to trade near the lows of the day at the time of this writing. If gold closes in the lower third of the day’s range the chance for a continuation lower is strong. It is on track to complete a bearish reversal candle today.

Further Weakness Likely Below Today’s Low

A drop below today’s low will signal further weakening. Currently, the low is at 1,868 but it may change by the time the market closes. The minimum retracement anticipated would be the 38.2% Fibonacci level at 1,857. On October 9 there was a gap in gold that has not been filled. I could get filled on a further retracement. A drop below 1,842 signals a move into the gap. If it persists then there is a good chance that the gap will be filled, which occurs at 1,835.

Bigger Picture Remains Bullish

The bigger picture in gold remains bullish but further signs of strength will be needed. Of note is the bullish reversal seen this week on the weekly chart. An upside breakout of a bullish hammer candlestick pattern occurred this week. Unless the weekly breakout fails with a drop below this week’s low of 1,842

the validity of such a signal doesn’t go away in one week. Therefore, the advance is anticipated to continue following a retracement.

200-Day EMA Initial Target at 1,904

Today’s high hit only the first target for gold on this bounce with the primary target being a test of the 200-Day EMA as resistance. It is currently at 1,904 and relates to the minor swing low at 1,901. An intermediate price zone where resistance could be seen is around 1,895. Nevertheless, gold remains in a downtrend. So far, it has just bounced once and has not negated the downtrend price structure. Once that occurs the sustainability of the rally will be enhanced. The first sign of it looks to be on a move above the weekly high of 1,927, with higher confidence on a rally above the most recent swing high at 1,947.

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