Two views of Gold showing current weakness. It's hanging by a thread ( yellow LMLP) as far as
I am concerned and bumping along the bottom of this LMLP from the dominant yellow fork. Perhaps a H&S formation in the making?It is important NOT to ever think in terms of one fork when you look at this ( or any other) chart. At any one time there are endless forks 'in play' but if you can identify the most important pivots you can draw multiple forks ( & RL's) and see the dynamics of price working plus see the potential critical support/resistance areas.
EURGBP is at a important Schiff CL and the big figure .8200 is the area to watch. We have already seen one bounce off this blue CL in June 2010 and this is one possible area of support. There is no trade yet....but i will watch for a reversal setup entry..perhaps a over and under divergence or a 2B reversal or even a pattern to trade off etc etc. Remember we are talking daily or weekly TF's here so great care should be taken especially as my personal view is that the process of price penetrating a line like (& in any time frame) this involves the expenditure of energy received from that line on the first and subsequent touches - hence we often see diminishing tops LH's in a sideways pattern and sometimes eventually a break below. Here's the current information as it is below on a series of chart shots just showing this fork and it's Schiff relation in blue:
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