Gold made a stronger pull back yesterday and all the short-term bears rejoiced……but I believe their enthusiasm will not last…..Gold is making bigger upward moves than the pull backs and trend remains bullish as price continues to make higher highs and higher lows….Did you see where the decline in Gold price has stopped? Right above the previous resistance area of $1,245 which is now support. Gold retraced nearly 61.8% of the recent rise and price stopped right on top of the short-term support trend line connecting recent lows.
My first target remains $1,280 and I see many chances of challenging $1,300-$1,320.
Today I added to my long positions in Gold at $1,245 in April contracts. I believe we are still in a bullish trend and yesterday’s pull back was justified. For me it is not a sign of weakness but a sign of a healthy bullish trend with the necessary pull backs to relieve overbought conditions. However we should not ignore the possibility that we have already topped. There are slim chances for this bearish scenario but overall we would not like to see Gold price break below $1,200.