Gold correction looks complete around $1761

Written by Financial Educator

December 3, 2021

Gold has dropped through $1761 lows just shy of initial support around $1758 mark. The yellow metal is now seen to be bouncing back toward $1780, which is initial resistance. A break higher will confirm a meaningful bottom in place just ahead of critical support.

Gold might have completed its corrective decline that had begun from $1877 mark on November 16. If the above structure is correct, the yellow metal will be looking to stage an impressive rally toward $1900 from here.

Gold is carving a larger degree corrective wave (a)-(b)-(c) since $1677 lows. The rally between $1677 and $1834 was an impulse labelled as Wave (a) on the 4H chart here. The subsequent drop towards $1721 was a corrective zigzag pattern marked as Wave (b).

Since then, the yellow metal has been carving Wave (c) potentially towards $1928-30 mark. Looking at the sub-waves, Gold might have terminated Waves 1 and 2 around $1877 and $1761 levels respectively. If the above holds well, bulls will be inclined to resume Wave 3 rally soon.

Traders might be inclined to initiate fresh long positions around current levels ($1775), with risk just below $1758 and potential target above $1900 levels.

Prepared by

The Profinacademy.com Team

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