SINGAPORE: Spot gold may bounce more into a range of $1,840 to $1,849 per ounce, as the downtrend from the April 18 high of $1,998.10 may have reversed.

Three waves make up this trend.

The third wave labelled C seems to have completed around its 100% projection level of $1,793.26.

This wave could be further broken down into three smaller waves. The third small wave, the wave c, stopped around its 176.4% projection level.

These relations, along with the strong bounce from the Monday low of $1,786.60, suggests a reversal of the downtrend. Support is at $1,813, a break below may cause a fall into $1,797-$1,805 range.

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On the daily chart, a long-shadowed hammer formed on Monday, which is a typical reversal pattern.

A projection analysis reveals a break above a resistance at $1,818.

Chances are the metal may test the next resistance at $1,842.