Based on a textbook head-and-shoulders top pattern, the downside measured target in the SPDR Gold Shares (NYSE: GLD) is 89.50, which also happens to coincide with a test of the Jan-June up trendline, now at 89.20.

If the last portion of this decline does unfold in textbook fashion, then we should be looking for an upside reversal (buy) signal in the upcoming hours to initiate a potent upmove into the 93.50-94.00 area.

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com.