Correction or Consolidation in Gold ?


Comex gold crashed from 1535$ to 1495$ due to delayed tariffs by US. Last week White House informed that additional tariffs on $300 billion goods which were suppose to kick in from September will now come in effect from December. This simple move by Washington gave a good jump to Dow Jones Index which recovered nearly 600 points from lows in single session. Dollar Index also moved higher which resulted in gold crash.

As of now we have very less uncertainty in market as new tariffs are delayed and Trump suggested he may reach an agreement with China before December. Iran matter is also diluted as nothing happening on that part as well. For now market is almost risk free hence gold is trading with a weak sentiment.

So should we take this move as gold correction or consolidation ? My opinion would be we should see this mild correction as a consolidation. It cannot be called major correction as market is yet to break major bases. Most of the moves which came last week were news driven and sooner or later we will see uncertainty since Trump would be tweeting soon.

Its a good consolidation phase which could be use by long term buyers to accumulate small qty in every dip. For now base of this bull trend which started at 1230$ and gone till 1530$ stands at 1450$. Till this base is intact I dont see major correction in market.

Intraday levels for today’s gold movement would be 1488$ thisĀ  is major support for today in gold. If trader breaks and sustain below 1488$. Then expect good correction in xauusd intraday till 1480$- 1475$.

Resistance in comex gold stands at 1503$. If trader breaks and sustain above 1503$. Then expect good rise in xauusd till 1512$- 1521$.

Conclusion: Comex gold trend is flat to weak for now. Avoid taking short and wait xauusd to break resistance to initiate buy.

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