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Gold: On A Glittering Edge

Gold December BUY

CMP: Rs 29500 (As on 03rd Oct 2017) Gold

Buy at CMP: Rs 29500-29350

Targets: Rs 30015-30490

Stop loss: < Rs 29180 more than three years, it becomes quite clear that a
corrective fourth wave (if not ‘X’) is in the making.
2017 has been a good year so far for Gold. In last nine Luckily, the two legs of 4th wave are over and we are
months, we have seen negative monthly closings nearing a 3rd leg proceeding which if happens in next
only in the months of June and September. The yellow few days, will definitely add more glitter this Diwali.
metal traded past $1350 to score new highs in early Meanwhile, a trend line breakout within the 4th wave
September but then bears dominated the rest of the has already happened in August. The 3rd leg of the
month to bring the curtain down with an over three current 4th wave is likely to be huge and we may see
percent of losses on monthly basis. However, prices prices scaling multi year highs till $1440 from the
are still under the impressive bullish candlestick of current range of $1280.
August month which is rekindling the possibility of
the continuation of positive trend this Diwali. We recommend buying in MCX Gold December
contract at CMP Rs 29500 and on dips till Rs 29350
On analyzing monthly chart, we can safely conclude for targets in the range of Rs 30015-30490. Maintain
that the primary trend in Gold is bearish. However, stop loss below Rs 29180.
short term bullish rallies are a part and parcel of this
larger trend and there is enough room for a trader
with a six-seven weeks view, to benefit from the
price revival generating partly from short covering
& partly due to fresh buying that is driven by
external factors such as geopolitical tensions. Thus
if we capture the pattern on monthly chart after the
period of massive bearish 1-2-3 structure that lasted

6 ARIHANT CAPITAL ¡ OCTOBER 2017