Gold near term outlook:
The Nov 17th email once again said there was no confirmation of even a shorter term low "pattern-wise". The market has continued lower since and with the long term target since July of declines below that Dec 2015 low at $1046 still favored (see longer term below). Nearer term however, the market is oversold after the rapid reversal from the Nov 9th high at $1337, is seen in the final downleg in the decline from the Sept 7th high at $1353 (wave 5) and the USD is seen nearing a top for at least a month (inverse relationship, see Tue email on the USD index) with all suggesting a rising potential of a bottom for at least a month in gold (as with many markets that appear to be nearing reversals, see recent emails).
At this point, there is still no confirmation of such a low arguing further downside, but would expect the momentum to start slowing ahead and in turn would start to increase the likelihood of such a bottom. Nearby support is seen at $1280/83 (earlier low) and $1267/72 (50% retracement from the Dec 2015 low at $1046 and "potential" area to form such a low). Nearby resistance is seen at the broken base of the bearish channel from July (currently at $1200/05).
Bottom line: month long low seen nearing, but scope for further (likely limited) lows before the final bottom is in place.
Strategy/position:
Took profit on the Nov 12th resell at $1259 on Nov 22nd above that bearish trendline from Nov 10th (then at $1206, closed at $1212 for $47). Also reversed to long but the market failed to hold the base of that bearish channel from July, and with at least some further downside favored, would just stop here (currently at $1187).
Long term outlook:
No change in the very bearish view since the summer of a major top at the July 6th high at $1375 (then also a bearish trendline and 38% retracement from the Sept 2011 high at $1920), and with eventual declines below the Dec 2015 low at $1046.
Note that the 3 wave rally from that $1046 low (A-B-C, a correction), weak long term technicals (see sell mode on the weekly macd) and large falling wedge patter from 2011 all still argue eventual declines below that $1046 low. But as discussed above, there is rising risk for a month or more bounce and would be seen as a correction within this long term decline (see "ideal" scenario in red on weekly chart/2nd chart below).
Bottom line: long term target since the summer below $1046 remains with a potential, approaching month long bounce seen as a correction within in this long term decline.
Strategy/position:
Bearish bias from Nov 10th at $1259 was switched to neutral on Nov 22nd at $1212. Though eventual declines below $1046 still favored, too much rising risk of a month long bottom to switch back here.
Current:
Nearer term: looking for a slowing downside momentum as a sign of an approaching month long low.
Last: short Nov 10 at $1259, took profit/reversed to sell at $1212 Nov 22, stopped Nov 23 at $1187).
Longer term: eventual decline below $1046 still favored, risk rising for a month long bounce.
Last: bear bias Nov 10th at $1259 to neutral Nov 22nd at $1212.
