At $1375/$1380, Gold achieved initial projections for the fifth wave for the Elliot wave structure in force since last year and witnessed a sideways consolidation. It has now breached below an up sloping channel that encompassed recent rise and has also violated a mildly descending one ($1287) denoting possibility of a retracement. It has hit an intermittent support at $1267, the 61.8% retracement from May lows and is approaching towards the 200 day MA. However given the dual break from the channels, the support at $1267 could prove to be temporary and Gold is likely to drift towards projection for the down move at $1250/$1236, also the 38.2% retracement from last year. In case downward momentum gains further traction, trend line since 2013 at $1200 should act as a floor. Graphical levels of $1300/$1307 will now be an important hurdle while short term resistances are placed at $1277 and $1287.
(Societe Generale)
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