Correction Scenario 1
Gold builds a base above $1490 and tests or marginally breaks the September $1566.20 high. Prices consolidate throughout much of October before finally collapsing below $1490 and into the next cycle low.
Correction Scenario 2
This scenario calls for a deeper correction and perhaps a backtest of the $1360 – $1380 breakout area. It requires a breakdown below $1490 in September. The initial decline would likely reach $1420 – $1440, followed by a consolidation and then a drop into a final low.
To favor one scenario over another, we need a $20.00 swing in either direction. Above $1530 supports the former – below $1490 establishes the latter.
Either outcome should lead to an attractive buying opportunity later this year. Our Gold Cycle Indicator (currently 285) should dip below 100 before prices reach a sustainable low.
AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit https://goldpredict.com/
This article was originally posted on FX Empire
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