Gold might be still correcting its recent drop between $1965 and $1850 over the last week. The yellow metal had reached $1900 levels yesterday before dropping sharply lower towards $1864 and swiftly recovering. Watch out for a push through $1914, before finding resistance again.
Gold short term wave structure reveals a potential double zigzag underway towards $1910/15 levels before reversing lower again. It might drop through $1875/76 levels intraday before turning higher again, giving opportunities to trade both sides.
The yellow metal looks vulnerable to reverse lower towards at least $1780 levels within the next few trading sessions. Any further drop from there would threaten to break below $1670 support, going further. We shall take a review again around $1780 levels and turn bullish if required.
The larger degree wave structure reveals that Gold might be unfolding as an expanded flat corrective wave since $1920 highs in 2011. The yellow metal seems to have already completed Wave (A) lower towards $1046 in December 2015.
Going further, Wave (B) might have terminated around $2075 or could print one more high before terminating and reversing sharply lower again. It remains to be seen how prices react around $1780 levels, in the short term. If bulls are back in control, Gold could begin to rally towards a new high.
Either way, the metal is expected to drop over the immediate short term and resistance is seen towards $1910/20 levels. Watch out for a dip towards $1975 first, followed by a rally towards $1910/20 before finally reversing lower again.
Remain short against $2075, target $1780.