Below is what we discussed yesterday, about the prospect of a near-term base formation (inverted head-and-shoulders) that has been developing since Nov 1.
While I have no idea exactly why spot GOLD pivoted to the upside immediately after testing Monday's pullback low at $1145.97, the fact that it did so preserves the developing base, and positions the price structure right at its "neckline" resistance breakout plateau at $1180.
A sustained climb above $1180 should propel GOLD above $1184--its Oct-Nov down trendline.
Such a breakout will be technically significant, and will project GOLD towards $1230-$1250.
Only a failure to hurdle $1184 followed by a plunge beneath $1145 will wreck the strengthening near-term set-up. MJP 11/14 14
Spot GOLD (and its proxy, the SPDR Gold Shares (GLD)) certainly appear to be building a near-term base formation-- starting at the beginning of Nov that could be morphing into an Inverted Head & Shoulders pattern as we speak.
That said, however, to trigger the upside potential of the budding base pattern-- to $1230/50 next-- Spot GOLD must climb and sustain above $1180 (113.05/25 GLD).
Unless and until it does so, all of the action in Nov so far might merely be another sideways congestion area within the still dominant downtrend-- ahead of approaching weakness that will press spot GOLD to new lows beneath $1100 (109.00 GLD). MJP 11/13/14