8 Feb 2021 ● 06:23 AM
Gold spot prices are making an almost double bottom where the 1st bottom was made in 1764 and the recent low is at 1784. But on the MCX we are seeing a lower low than what we saw in November. This results in different wave counts, and it has happened before. The entire decline from August remains in wave 4 down. The trendline of the lows is at 46,200, which should be the ultimate support. Once complete wave 5 up should start and the initial resistance will be near the moving averages which are closer to 48,600. Once that has crossed we should see a test of the upper end of the falling channel near 51,000.
In the very short-term the fight is going to be between a falling USDINR and an attempt by the dollar price of gold to go up. USDINR has been falling very slowly but if it speeds up below 72.70 then it will put additional downward pressure on the MCX price. It, therefore, requires the spot price of gold to go up much more to balance both sides.