Gold rebounds strongly this week as poor economic data from US raise recession worries. Buying extends after today’s ISM non-manufacturing index, which drops to three-year low.
Current development argues that corrective fall from 1557.04 has completed at 1459.08, ahead of 38.2% retracement of 1266.26 to 1557.04 at 1445.96. Break of 1535.68 resistance will add much credence to this case and target 1557.04 and above.
However, it should noted that Gold is also close to key long term fibonacci level of 61.8% retracement of 1920.70 to 1046.37 at 1586.70. Hence, upside of the next rally might be limited.
