Comex gold futures fell marginally with earlier gains arrested by scepticism over whether OPEC members would be able to implement production cuts that could fuel inflation. The recent hints from the Federal Reserve on a December rate hike has dampened investor enthusiasm for bullion.

Comex gold futures moved in line with our expectations. Our favoured view expected prices to find support around the $1,320-25 per ounce levels and then edge higher.

A potential target still lies around $1,450-55 levels, being an equality target in the coming months. Once above the near-term resistance at $1,345-47 further resistance is seen at $1,365-75 levels now. Once above here, prices could push higher further towards $1,400 levels or even higher in the coming sessions. Supports are now seen at $1,305-10 levels.

Direct fall below $1,305 could postpone the bullishness again and such a fall could see prices testing $1,288-90 levels but, we still feel it could once again find good support there edge higher again. Failure to hold support here could dent the prospects of the uptrend.

Price structures look positive with a broad consolidation still under way and since the important support at $1,305-10 has held once again for the fourth time in the last six months could discourage any bearish bets. The trigger for the next rise higher would be on a close above $1,347.

Favoured view expects prices to find support around the $1,305-10 levels and then edge higher towards important resistances around $1,365 followed by $1,435-50 levels.

Wave counts: It is most likely that the fall from the record $1,925 to the recent low of $1,088 so far, was either a possible corrective wave ‘A’, with a possibility to even extend towards $1,025-30 levels or a complete correction of A-B-C ending with this decline. Subsequent to this decline, a corrective wave ‘B’ could unfold with targets near $1,375 or even higher. After that, a wave ‘C’ could begin lower again.

Alternatively, we can also expect wave ‘B’ to extend to $1,476 levels. If the current decline as a whole from $1,920 can be considered as a fourth wave, then the fifth wave could begin and cross $1,700 in the long-term.

As prices have broken certain important resistances and shows impulsive tendencies, we will now stick with the above count. And as mentioned earlier, once prices reach $1,025-45 levels we will look for any signs of reversal. There are signs of a turnaround, and prices convincingly risen in volumes and closed above $1,300 levels, which further reaffirms our wave count.

RSI is in the neutral zone now indicating that it is neither overbought nor oversold. The averages in MACD are still below the zero line of the indicator again, indicating a bearish reversal. Only a cross over again above the zero line could hint at a reversal in trend to bullish.

Therefore, buy Comex gold on dips to $1,310-15 with stop-loss at $1,301 targeting $1,345 followed by 1,395.

Supports are at $1,310, 1,305 and 1,288. Resistances are at $1,345, 1,365 and 1,400.

The writer is the Director of Commtrendz Research. There is risk of loss in trading .

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