Research team of Development Bank of Singapore Limited, suggests that the market is buying gold and seeing a pseudo bullish reverse head-and- shoulders pattern, but resistance at 1356 and the pattern’s neckline at 1362 would pose as substantial barriers.
“We hold the view that gold prices are languishing in a broad triangle since gold traded down to a cyclical low at 1046.”
“Gold is currently staring right at a channel support, but needs to run lower to complete a corrective abc dip. A channel-support break would likely push gold lower toward 1303. There, market would seek a timeout & feature a bout of consolidation.”
“But that is likely an effort to buy time before gold eventually sees any bounce higher and has more passengers alight from gold bus. As for broader picture, market needs to see further waning interest and momentum loss to feature decline for 38.2% Fibo retracement of Aug18’s 1160-lows vs the recent 1347-high, around 1275. That is likely to be a respectable support zone. Certainly, that would be a better zone to rebuild longs.”
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