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Gold<\/a> triggered a daily bullish reversal earlier in the session as it rallied above the highs of the past two days. However, once a high of 1,930 was hit it sold off sharply, falling back below the opening price before finding support at the day\u2019s low of 1,917. It currently shows a bearish inverted hammer candlestick pattern for the day. If it closes in a similar weak position, it could be followed by a deeper retracement.<\/p>\n<\/div>\n<\/div>\n The advance earlier in the session tested resistance around the internal downtrend line and price was clearly rejected to the downside. If gold closes weak as it looks now, then earlier breakouts above yesterday\u2019s high of 1,924 and Wednesday\u2019s high of 1,929 have failed. The buyers were in charge earlier but by the end of the day it looks like the sellers are in charge once again. That could start to change if gold is able to close the day above yesterday\u2019s high.<\/p>\n Heading into next week a drop below today\u2019s low of 1,917 triggers a breakdown of the bearish hammer and would be a sign of weakening. If that occurs the chance for a continuation lower for the retracement increases. However, support might still be seen around Thursday\u2019s low of 1,916 or Wednesday\u2019s low 1,915, which is also the retracement low. Nevertheless, a decline below 1,915 points to a further decline and a likely test of the 200-Day EMA as support. The 200-Day line at 1,910 and the 61.8% Fibonacci retracement at 1,911 together create the next lower target zone.<\/p>\n If gold consolidates above the 1,915 low rather than falling further to a new retracement low, then today\u2019s high of 1,930 is near-term resistance. A decisive move today\u2019s high would be the first sign of strength and a daily close above it will confirm. If this occurs gold would also be back above the 34-Day EMA, now at 1,926 and the downtrend line.<\/p>\n If gold\u2019s correction continues, it certainly looks like it is getting closer to the end. It has been trading between a downtrend and uptrend line and the lines cross in two weeks. This means that within five to six days or so there is a strong chance that gold will cross one of those lines.<\/p>\n For a look at all of today\u2019s economic events, check out our\u00a0economic calendar<\/a>. <\/b><\/p>\n<\/div>\n<\/div>\nFailed Bullish Breakout<\/h2>\n
A Drop Below Today\u2019s Low of 1,917 Signals Weakening and Possible Further Downside<\/h2>\n
If Consolidation Follows, Then Today\u2019s High Marks Near Term Resistance<\/h2>\n
Correction Getting Closer to the End<\/h2>\n