Gold Investors: All Eyes On The Striking Implications Of The 2012-2013 To Now Link

Still, there is also the possibility that the history will not repeat itself to the letter and that gold will move above the 50-day moving average right away – just like it did in late November 2012. If this is the case, then we will likely not have any meaningful comeback once gold moves close to $1,260, as the above would imply that the bigger corrective upswing in gold had already taken place.

For now, the former scenario is more probable, but we are keeping our eyes open for signs that would confirm the latter.

Either way, the next support levels would be provided by approximately the $1,237 level (the 61.8% Fibonacci retracement based on the previous rally) and the 2018 lows (approximately $1,160). Gold could correct after reaching these levels and none of such short-term upswings should be interpreted as the end of the big decline. Back in 2012 and 2013, the analogous moves were just the local ones that preceded the true plunge.

Does this mean that gold definitely has to rebound from the above-mentioned price levels? No, the situation in the USD Index is different today and thus gold might react in a different manner, for instance by declining much earlier and in a more volatile manner. However, the above gives us a great default indication regarding the likely next gold price moves. Instead of determining the prices moves from scratch, we can use these default targets and adjust them upward or downward based on what kind of signals and confirmations we get along the way.

This is what we see based on the technicals. You have already seen the peculiarities of the gold price forecasts when you followed the link at the very start of this article. Also, take a good look at our Gold Trading Tips. Enjoy the insights and make good use of them!

Summary

Summing up, it’s almost certain that the next big move lower has already begun and that the 2013-like slide is in its early stage. Based on the updated version of the 2013-now link, the implications are even more bearish than we had initially assumed. The downside target for gold remains intact ($890), and the corrective upswing that we just saw seems to be a rather natural part of the bigger move lower – not a beginning of an important move higher.

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The full version of the above analysis also includes the analysis of silver, gold miners and the omnipotent USD Index. These provide vital clues as to the next short-term moves and additional ...

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