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Gold Could Do Something Interesting on November 28th

There are some interesting clusters of price and time barriers coming up for gold in the next few weeks. It's worth being aware of where they are and what they might mean for the gold market. The first significant point is derived mainly from the range between the interim low labelled B and the high labelled C in figure 1. This is a daily chart.


Figure 1

Figure 1 shows the vertical range BC divided into the Fibonacci ratios by the green horizontal lines. Notice how the market recently retraced as far as the 0.5 level, where it failed to close below and reversed. This validates the 0.5 level as a good potential area of support.


Look at the pink channel lines shown in figure 2. They show the descending levels of support and resistance which have been very important to price action since making the high at C.


Figure 2

The market has oscillated between these barriers in a choppy retracement so far. The channel lines have been tested five times and have alternated after each retest.


Now, look at the rising trendline constructed by connecting the low at B with the secondary low which came soon after in figure 3.


Figure 3

You'll notice that the higher descending trendline coincides with the rising trendline from B right on the 0.5 retracement level, which we know has already been tested and validated. The area in the yellow circle is showing multiple horizontal and diagonal price barriers intersecting one another very precisely.


Figure 4 reveals another similar point when the rising cyan trendline is copied exactly and projected from the low that came shortly after A. This is the low is used because projecting from the absolute low at A would cause the trendline to cut through price action.


Figure 4

A second yellow circle denotes where the lower pink trendline cuts through the lower cyan trendline. Notice how they intersect right on the green horizontal level from B which was used to obtain the first Fibonacci range. Notice also how the yellow circles are almost exactly vertically aligned. This is not a coincidence.

Figure 5 shows the time duration between the high at C and the time of the yellow circles.


Figure 5

Both clusters land on roughly November 28th which is 62 trading days after the high at C. 62 is a derivative of the Golden Ratio number, phi, 0.618. Markets have a relatively good chance of reversing on or around a significant time candle such as this. This is, of course, much more significant when it coincides with other price/time barriers as in the yellow circles.


Figure 6 includes a final Fibonacci division of the range from the low at A to the high at C. These are the red horizontal lines.


Figure 6

The 0.618 level also cuts through the lower yellow circle. If the market does retrace as far as here, the 0.618 level of the whole prior uptrend could give it a substantial amount of support.


So what will the market do? Well, the points in the yellow circles are not forecasts. They don't necessarily have magnetic properties. If, however, the market does happen to go into one of them, it's very likely it will find a very significant degree of support (or resistance if the price rises from below) and a reversal is probable. The market is not far away from the price level of the higher yellow circle. Be aware that it could find either support or resistance here. The market could come down from above, as shown in figure 7. The new fainter candles in figure 7 are not real, they are generated to show what the market could do.


Figure 7

Alternatively, figure 8 shows how the market could find resistance, although this is not as likely.


Figure 8

It will be interesting to see how the market responds to these price and time barriers, especially if they happen to coincide.

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