Gold is trading nicely lower since the start of September after the break through the rising trendline of a corrective channel. We knew at the time that it was an important signal for a change in trend.
We are seeing patterns in gold commiserate with what Elliott Wave Theory calls a “truncated 5th wave” pattern. All bear cycles have 5 full waves to the downside from the highs, and we have been in wave 5 since the $1,434 highs.
Gold found some support and it seems that price is now at the start of a larger three wave retracement back to $1,305-$1,326 region. As such, be aware of a slow and choppy recovery in the next few days before downtrend resumes.