Comex gold futures fell to a two-week low after the last sweep of opinion polls before Britain’s referendum on EU membership gave the campaign to stay in the bloc a slight edge.

Comex gold futures moved against our expectations. As mentioned earlier, the weekly price structures still looks healthy for the uptrend to gain momentum, and we favoured prices to test important supports and push higher again. Once again prices have shown their vulnerability sustaining above $1,300 per ounce levels, adding fuel to the bear camp. Strong support is noted near $1,245-50 levels and a fall below here could hint at weakness again.

Short-term charts indicate negative momentum pushing prices lower towards supports mentioned above. There is still some hope that the supports could hold and prices would make an attempt again to cross the recent highs at $1,313 and subsequently further higher towards important resistance at $1,345-50 levels. Fall below $1,237 could dash our bullish hopes and such a fall could revive bearish hopes for prices testing $1,175-85 levels or even lower.

Favoured view in the short-term still expects prices to be finding support around $1,245-50 levels and then edge higher towards important resistances around $1,345-50 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. Subsequently, 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 need to convincingly rise and close above $1,300 levels, which have not happened so far.

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

Therefore, buy Comex gold on dips to $1,245-50 with a stop-loss of $1,236 targeting $1,315 followed by $1,345.

Supports are at $1,245, 1,235 and 1,210. Resistances are at $1,276, 1,295 and 1,345.

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

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