Gold jumped to new record high of 1424.3 last week but formed a short term top there and pulled back. Initial bias remains mildly on the downside this week for deeper fall. Though, strong support is expected at 1315.8 support, which is close to 38.2% retracement of 1155.6 to 1424.3 at 1321.7, and bring up trend resumption. On the upside, above 1395 minor resistance will flip intraday bias back to the upside. Further break of 1424.3 will target 161.8% projection of 1084.8 to 1266.5 from 1155.6 at 1449.6 next.
In the bigger picture, rise from 1155.6 is treated as the fifth wave of the five wave sequence from 1044.5, which should also be fifth wave of the rally from 681 (2008 low). Such rally is still expected to continue towards 161.8% projection of 931.3 to 1227.5 from 1044.5 at 1449.6 before completion. Though, we're aware of long term projection target of 100% projection of 253 to 1033.9 from 681 at 1462 and we'd anticipate strong resistance from there to bring medium term correction finally. On the downside, however, break of 1315.8 support will be an early alert of medium term reversal and will turn focus back to 1155.6 support for confirmation.
In the long term picture, rise from 681 is treated as resumption of the long term up trend from 1999 low of 253. The anticipated correction didn't happen and gold will now likely climb further to 100% projection of 253 to 1033.9 from 681 at 1462 before making a top.
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