Morning Report

Gold declined sharply yesterday and it was very close to our yesterday's projected objective at 1102.00. The Elliott studies over short term basis shows that, the rebound from 1108.00 was needed to form the internal 4th wave for the first corrective wave A. Thus; we believe that, these inclines from 1108.00 to the current level will ease the path to achieve a new descending wave to complete the correction. Consequently, potential downside movements could be seen over intraday basis.

The trading range for today is among the key support at 1098.00 and key resistance now at 1144.00.

The general trend is to the upside as far as 865.00 remains intact with targets at 1249.00.

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RecommendationBased on the charts and explanations above our opinion is, selling gold from 1128.00 targeting 1108.00 and stop loss above 1144.00 might be appropriate.