Gold Stays in Recovery Mode

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( fxtechstrategy.com) - Our outlook on gold is to the upside on correction. The yellow metal closed the week last building on its previous week's gains.

With gold holding slightly higher above 1,677.95, we are now looking at the Aug. 25 low of 1,702.31 and then the Sept. 22 low 1,720.10. This zone is expected to reverse roles and provide resistance, turning the commodity back down. However, if taken out, further recovery strength should build up toward Sept. 23 high of 1,754.55.

Alternatively, the risk to this analysis will be a return to the 1,532.90 level, with a violation of there turning further downside pressure toward 1.500.00, its psychological level, ahead of its July 01 low at 1,478.05.

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All in all, Gold maintains an immediate upside bias on correction though retaining its medium term downward trend.

Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces The Professional Suite for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.