XULF Report
Despite US Consumer Confidence rising to a 5 year high gold is still range bound albeit the trading range has now been widened $9 due to the increase in volatility last night. Gold managing to hold ground, even though it dropped below short term support at $1382, shows that there is good demand for the metal. The $1400 level has become formidable resistance preventing the bulls from pushing gold higher. According to reports there are an increasing number of short positions by market participants, which although sounds bearish, could cause an intense rally if the bulls can trigger these short stops. The logical level for short stops will be just above the various resistance levels close to $1400 therefore a forceful attack at this level could deliver good results for the bulls.
Technically it’s more of the same story but the short term range has widened to $1373 to $1400 and the volatility caused another test of $1400 making a high of $1402 but was beaten down by the bears before firmly pushing through. There isn’t much to add from yesterday’s analysis in that the market is rather neutral. Bulls may find comfort in the fact that the medium term bearish trend has come to a halt but the market will not turn bullish until it convincingly crosses $1400. It should also be noted the parabolic has recently switched to a buy signal on the 4 hour chart which gives some more hope to the bulls. Support levels are now $1373 and $1354 (displayed by the blue lines) that could provide a bounce trade opportunity but carefully consider the fundamentals that would be forcing price lower to these levels before buying and always incorporate candlestick data. Economic data due out today is lacking the potential move the gold market with any sustained force but be aware Thursday’s calendar includes US Preliminary GDP and Pending Home Sales.
No comments:
Post a Comment