A Slight Deep Retracement or A Beginning of New Trend?

Hi Everyone

Recently, It s been an extraordinary movement in the gold market. When the gold reached 1530, then suddenly it was a kind of extremely big selling pressure that made it down to 1321, with only 2 days. Some fundamentalist said that high volatility happened because the Cyprus sold it gold's reserves to bailout their country. Well I guess that' s just one small part of the reasons. Lets take a look at the chart below.

Gold Price before breaks 1530

This was the chart when the gold has not yet broken the support line (1530). As we can see, there is a prior uptrend, a consolidation trend, and since it broke the support line, the question now is it the beginning or a downtrend or only a correction? I guess it is a beginning of downtrend at least until around 1100 - 1200. In my personal opinion there are two scenarios where the gold can go down further.

SCENARIO 1

Simple Set Method

Let s call this a simple method. There is a distance from the support line to the latest new high. I labeled it as an x. So when the price broke the support it will reach to the almost same x distance. That price will be 1248

SCENARIO 2

Fibonacci Retracement Method

In Scenario 2, I used a very popular technical analysis, called Fibonacci Retracement. with this analysis the first target for gold price to 1305 - 1318 and then the second target to its 61.8% at 1157.

So lets watch where the gold goes in weeks
Happy Trading All :)