Last week

The short term correction continued to push GOLD price to the downside. After a second attempt to move back above the 1290 level failed, the price just went straight down for the rest of the week.

It not only broke the 20-day moving average line, it also broke down the 40-day moving average line and closed under it last week. The outlook remains bearish for the short-term.

Last week’s trades

Gold futures, May 20, 2016. 60 minute bars.

There were lots of opportunities to get the trades wrong last week.

The price failed to reach either the first sell or the first resistance early on the week, and dropped sharply to the Pivot level, where it bounced.

It did that twice, and some traders were tempted by the bounce to get long, despite Nat’s warnings in last week’s preview that the momentum was on the downside

The long side was a losing trade, because Wednesday the price returned to the pivot level and dropped sharply to the first support level and subsequently to Nat’s first buy level.

The move from the pivot to Nat’s buy level was worth about $28, or $2,800 per contract, for those who caught it.

The subsequent bounce back to the support level was worth another $10 or $1,000 per contract.

This week

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