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Gold has stabilized but for how long?
The yellow metal received most of the headlines last month as the year-long rally shifted up a gear with the one month return exceeding 12 percent and, in the process, moving within striking distance of 2,000 dollars per troy ounce. Safe havens from global turmoil were also cut to one from 3 as fear of central bank intervention in Swiss Franc and Japanese yen left gold as the beacon.
In a couple of moves the CME Group raised the margin for trading gold futures from 4,500 to 7,000 dollars. The move came as a response to increased volatility after the unprecedented strong rally, not as an attempt by the exchange to dictate the direction, but mostly in order to keep some integrity in the market. Speculative involvement from hedge funds has been reduced as margin increases make an impact on the position size they are allowed to hold.
The potential for further stimulus signaled last Friday by Ben Bernanke, Chairman of the US Federal Reserve, continues to support gold. The 200+ dollar sell-off recently, however, was a reminder that nothing ever goes in a straight line. After having consolidated earlier this week renewed stock market weakness and squabbles over Greece (again) saw buyers return. Will traders have a strong enough conviction to take it much higher beyond 1,900 remains to be seen? Resistance above the recent high at 1,913 will be 1,965 while support can be found at 1,770 ahead of 1,700.
King Regards,
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Hi,
Lordoftruth, appreciate your analysis. Thanks! This is what my trading guru has for us:
GOLD (SPOT)
Monthly Trade Triangles for Long-Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Positive
Combined Strength of Trend Score = + 90
Its a solid gold performance. Should gold close where it is presently trading around the $1,873 level, it will be a all-time high weekly close in this market. Our analysis of the gold market building support getting ready to move higher was correct, and all of our Trade Triangles are in a positive mode. It would appear that this market remains in a strong upward trend. Short term, intermediate and long-term traders should maintain long positions with the appropriate money management stops in place. This is Adam's analysis of the gold market!
Happy Trading!
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Gold prices extended the gains last week, as concerns over the outlook for global growth and rising fears that the US economy is losing more momentum, which spread pessimism across global financial markets and increased demand for safe assets, which boosted gold prices and sent them above $1875 an ounce.
Concerns over the outlook for global growth intensified last week after data from the United States signaled the economic recovery was losing pace, where data from the housing, labor, and manufacturing sectors signaled economic activities continued to slowdown, which spread a huge wave of pessimism over the outlook for growth in the world’s largest economy.
Gold prices are most likely to continue their bullish trend over the coming period, especially since the level of uncertainty remains unusually high, as beyond the debt crisis in Europe, the uncertainty surrounding the outlook for global growth is also very high, and that should further boost demand for safe havens including gold.
Important data will be released next week from the United States, where the ISM Services will be released for the month of August, and expectations signal that economic growth slowed down further, and should that prove to be right, we expect gold prices to extend the rally next week.
King Regards,
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September 06, 2011
Gold fluctuated heavily on Monday with the start of a new week, yet generally was still biased to the upside as losses were broadly seen across markets with Asia starting the week with reaction to the weak jobs report from the United States and Europe battered by the pessimism and deepening debt crisis.
The debt woes in Europe and fears of another recession, especially in the United States, kept demand on gold as a haven evident, though was affected by the strong dollar and the fear of the high levels for the metal as investors start to feel the bubble burst for gold.
The volatility is expected to prevail on Tuesday especially after gold stretched for a new historic high above $1,900 per ounce which will keep choppy and volatile trading evident.
Investors from the United States and Canada will return from a long Labor Day weekend and the volume will return to the market and the sentiment will remain predominant with haven demand still supporting the metal to the upside.
King Regards,
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September 06, 2011
In line with our positive anticipation, gold is hitting new historical highs while we are writing these lines. The IM -impulsive- nature of the current wave of the suggested Elliott count continues pushing the pair higher. Our previous defined technical target of 1945.00 is under our technical microscope and breaching through it will bring panic buying pressure towards the psychological level of 2000.00. RSI 14 might cause fluctuation before achieving more upside actions. Our constructive bullish outlook is supported by the breakout above H 4 –long breakout- of camarilla studies as seen on the secondary image ( VISIT MY BLOG TO SEE THE CHART )
The trading range for today is among the key support at 1855.00 and key resistance now at 1945.00.
The general trend over the short term basis is to the upside targeting 1945.00 per ounce as far as areas of 1475.00 remain intact with weekly closing.
Support: 1912.00, 1900.00, 1888.00, 1872.00, 1867.00
Resistance: 1920.00, 1927.00, 1935.00, 1945.00, 1950.00
Recommendation:Our opinion is, buying gold around 1905.00 targeting 1945.00 and stop loss below 1879.00 might be appropriate.
King Regards,
Last edited by lordoftruth; 09-05-2011 at 09:24 PM.
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Kneejerk Reaction down to 1,862
September 07, 2011
Gold first support on Wednesday is the 1845-1855 area.....
The Swiss National Bank made good on persistent market rumours that it was planning to peg the SFr to the Euro in order to halt the dramatic appreciation of the currency which has been hurting the Swiss economy.
The announcement of a minimum EURCHF level at 1.200 nevertheless took the market by surprise coming after a couple of days where the SFr has been strengthening again towards 1.10 Euro.
With one more “safe haven” now literally removed investors will look to gold as the last man standing which also means that a
kneejerk reaction down to 1,862 following the announcement quickly attracted buyers who took it back up to 1,915.
Whether this will accelerate the appreciation of Gold, which currently is heading for its best year since 1979, remains to be seen. Investor interest has been falling over the last month despite new highs being reached with total gold holdings in long futures bets and exchange traded funds having dropped by 251 metric tonnes to 2,865 tonnes.
Worries about further margin increases on gold futures, which could force hedge funds to reduce exposure even further, combined with sellers who need to off-set losses on other investments could play its part although the fundamental reasons behind the month-long rally remain.
Gold has the potential to reach 1,970 over the coming months but after the recent 200+ correction short-term traders will be more inclined to book profits faster than before. This might slow down the ongoing rally but it won't stop it.
King Regards,
Last edited by lordoftruth; 09-06-2011 at 01:13 PM.
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Is gold ready for pullback!!!
Gold reached 1920 on Tuesday moring and the upper green panic line for the 2nd time. The first reaction at that upper line produced a 200 dollar drop. So far, gold has now pulled back 60 dollars since today's high. The potential that gold could begin a pullback to mid month September is gaining credibility. Part of the problem once again is that the 60 dollar selloff in gold just happened to come about 5 minutes before the Swiss National Bank announced that the would put a full intervention on and not allow the Euro to drop below the 1.20 level. Once again it looks like a fully coordinated effort by the central banks to intervene at a position on the chart where price is capable of really escalating.
King Regards,
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Gold declined sharply since the morning. Nevertheless, this decline didn’t confirm that the bullish impulsive wave has ended, which represents the fifth wave of the suggested scenario. The metal could be trading within the minor fourth wave of the fifth general wave, while after the current downside correction should end, the metal might rebound to the upside again; however, we remain neutral today, awaiting the completion of the current downside correctional movement.
The trading range for today is among the key support at 1772.00 and key resistance now at 1920.00
The short-term trend is to the upside targeting 1945.00 as far as areas of 1475.00 remain intact
Support: 1835.00, 1825.00, 1815.00, 1800.00, 1777.00
Resistance: 1845.00, 1855.00, 1867.00, 1879.00, 1900.00
Recommendation: We remain neutral today awaiting more confirmations!!
Gold markets had a wild day on Tuesday as traders bought, sold, bought, and then sold again in the session. The $1,900 level is acting as a temporary ceiling in this market, and this struggle isn’t overly surprising. The resulting candle does look like a hammer of sorts, and the bottom of it touched the $1,850 area, and area that we identified as support. A breaking of the highs on Tuesday sends this market back up. If we get pullbacks, we are looking for support near the $1,800 level as well.
King Regards,
Last edited by lordoftruth; 09-06-2011 at 08:43 PM.
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September 08, 2011
Gold prices tumbled on Wednesday amid rising optimism around global financial markets, where traders were optimistic after Italy announced new austerity measures, which provided stock markets in Europe and the United States with strong bullish momentum, and accordingly, traders opted to invest in higher yielding and more risky assets, which put strong negative pressure on gold prices one day after rising to a new record high on Tuesday.
We still preserve our bullish outlook for gold prices, where traders are likely to continue targeting safe assets including gold amid the huge uncertainty that continues to surround the outlook for global growth, especially since emerging signs suggest global growth is slowing, and that should continue to support demand for gold as a safe haven over the coming period.
Moreover, traders will be focused on rate decisions from Europe, where the Bank of England and the European Central Bank are both expected to leave the benchmark interest rates unchanged, however, some traders are speculating both the BOE and ECB could signal a Dovish change in the monetary policy outlook.
FOR MORE INFO GO TO:
Last edited by lordoftruth; 09-07-2011 at 12:04 PM.
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