Gold is ready for huge drop (Double top soon in play)

On 2nd September I've written that Gold could drop under the 1680-1690 zone, confirming a large double top pattern.
Also, yesterday and on Monday I draw attention that the recent rise is ONLY a correction and not a genuine reversal.
And, indeed, yesterday, on the back of CPI data, Gold dropped more than 300 pips from top to bottom, negating a week of growth.
So, what's next?

Looking at the posted daily chart we can see that the trend is very bearish with a sequence of 5 lower highs at this moment and also from mid-June, Gold is trading in a descending triangle.

I consider the recent correction finished after yesterday's reversal and I expect a drop under important 1680-1690 support. Considering the importance of such a break and the possibility of large SLs under this level, I expect acceleration to the downside and a strong bearish move in the coming weeks.

The longer-term target can be 1500 and if you are "scared" of a 2k pips drop, all you need to do is to look at the March- April drop followed by the June-July drop, which is also 2k pips. So, the triangle's target is not only not out of the question, but very probable.

My 2nd Sept analysis:

Monday analysis:

Yesterday's analysis:

Best regards!

Mihai Iacob

Yorum:

Gold is close to breaking under short-term support.
IMO the next important support will not offer much rebound, more like a pit stop.