Gold Inflects off Key Support – Daily Structure

May 5, 2009: 10:37 AM CST

Gold prices recently defended a critical support area.  Let’s see Gold’s daily structure and note the confluence of Fibonacci and Moving Average support.

Gold has strengthened roughly 30% from its November 2008 lows, but fell short of breaking to new highs on its run-up in February.

We’ve experienced an expected/orderly pull-back/retracement off the $1,000 per ounce level into a key confluence support level that was critical for ‘gold bulls’ to hold.

The support comes in at $858/$860 per ounce, which reflects the 50% Fibonacci retracement off the October/November closing lows and the February high.  The 200 day simple moving average also rests at the same level, giving us confluence support that has held.

There is also a fractal Elliott Wave count (not shown) which holds the swing from $1,000 to $900 in March as fractal Wave A; the swing back up to $975 in March as being Wave B; and finally the swing down to the $850 level in April being the final Wave C of the possible correction phase.  If this fractal Elliott is correct, then we’ve just begun an upward impulse that could challenge or exceed the $1,000 level… provided the $850 support level holds.

A positive momentum divergence set-in at the $850 lows and price cleared the converging EMAs… though dropped back beneath them.  Bulls need to push price comfortably above the EMA support line at $900 to make the forecast clearer.  As such, holding above $900 per ounce would tip the balance overwhelmingly in favor of bulls; breaking beneath $850 would tip it back to the bears.

Let’s keep watching as the structure unfolds, but for now, it seems that $850 will hold as key support.

Corey Rosenbloom, CMT
Afraid to Trade.com

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4 Comments

4 Responses to “Gold Inflects off Key Support – Daily Structure”

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  2. New Video Analysis of the Gold Market | Afraid to Trade.com Blog Says:

    […] New Video Update on the Gold Market May 6, 2009: 7:00 PM CST // What are the “Trade Triangles” saying about the gold market?  Fresh from his recent vacation to beautiful New Zealand, Adam Hewison stepped back into the “Digital Den” as they call it at Market Club and released this most recent updated video on gold where he walks you through gold’s multi-timeframe structure, Fibonacci, and possible opportunities, similar to that of which I showed you in my recent post “Gold Inflects off Key Support.” […]

  3. TheTradingReport » Blog Archive » New Video Update on the Gold Market Says:

    […] What are the “Trade Triangles” saying about the gold market?  Fresh from his recent vacation to beautiful New Zealand, Adam Hewison stepped back into the “Digital Den” as they call it at Market Club and released this most recent updated video on gold where he walks you through gold’s multi-timeframe structure, Fibonacci, and possible opportunities, similar to that of which I showed you in my recent post “Gold Inflects off Key Support.” […]

  4. New Video Update on the Gold Market | Penny Stock Trading System Blog Says:

    […] What are the “Trade Triangles” saying about the gold market?  Fresh from his recent vacation to beautiful New Zealand, Adam Hewison stepped back into the “Digital Den” as they call it at Market Club and released this most recent updated video on gold where he walks you through gold’s multi-timeframe structure, Fibonacci, and possible opportunities, similar to that of which I showed you in my recent post “Gold Inflects off Key Support.” […]