April 25, 2013 – Gold (daily chart) has extended its bullish correction towards the key 1475 resistance level. This occurs after price plummeted to a low of 1321 less than two weeks ago, which approached major support around the 1315 level. Since that 2+ year low was established, price has made a partial recovery with a bullish correction that has risen above the 1425 support/resistance level and just today reached the 50% Fibonacci retracement of the recent plunge.
While the trend for gold is still clearly to the downside, the current bullish correction could likely extend further before a potential resumption of the bearish trend that has been in place since the October 2012 highs near 1800. Key upside resistance objectives on an extension of the bullish correction reside around 1475 and then 1530, with the latter objective representing exceptionally strong resistance.
James Chen, CMT
Chief Technical Strategist
City Index Group
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