Weekly Report 19/12 -23/ 12/ 2011

Looking at where the metal has gone after breaching the initial support-turned into resistance- at 61.8% of CD which represents second technical target of our previous explained bearish harmonic AB=CD pattern, proves that the extended technical targets of the harmonic pattern are still in progress. Having said so, we recommend reviewing your own weekly chart to see the clear long black candlestick pattern that could beat the oversold sign appearing on daily Stochastic. To summarize this, gold may achieve some kind of correction before resuming the downside rally, softly targeting the second extended technical target of AB=CD at 127.2% of CD leg after clearing the first extended objective at 76.4% earlier.

The trading range for this week is among the key support at 1475.00 and key resistance now at 1665.00.

The general trend over the short term basis is to the upside, targeting $ 1945.00 per ounce as far as areas of 1475.00 remain intact with weekly closing.

Previous Report

RecommendationBased on the charts and explanations above our opinion is, selling gold around 1610.00 targeting 1533.00 and stop loss above 1655.00 might be appropriate.