Gold Technical Analysis: On the verge of a correction to the downside if laws of channel gravity play out

Ross J Burland FXStreet

Gold is on the verge of a correction to the downside if indeed the rice respects the descending wedge's and the interim channel's laws of gravity. Bears got to be liking that bearish shadow at the top of the channel aligned with stochastic resistance.
Bulls would need still to close above 1298 to negate the bearish bias although a test of 1302.80 and a close above 1303.20 would be preferable to buy into.
On the downside, below 1278 and then 1275 guard a run down to test the 1266 lows again ahead of where 200-DMA meets that 50% Fibo down at 1254.
A breakdown there opens the 61.8% Fibo target at 1231 which meets the mid-Dec lows/Oct resistance.

Daily chart

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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