XULF Report 18/06 - Markets are awaiting for Bernanke's comments at the FOMC press conference

XULF Report

Another quiet and range bound period is expected today as the markets wait for Bernanke’s comments at the FOMC press conference on Wednesday scheduled 19:00 GMT. Taking into account the mixed bag of data and the unspectacular May Non-Farms Bernanke is likely to reiterate stimulus reduction is data dependant therefore gold looks like it could be stuck in the $1375 to $1390 range for some time to come. There could be some volatility beforehand if the US housing data tonight shows further improvement in new builds which could cause a spike in equities and suppress gold but it does feel like gold needs a significant shift in the fundamental outlook in order for the bears to gain control over the bulls.

Keep looking to sell at resistance and buy at support levels displayed by shooting stars and hammers and/or two or more touches of a certain price level as this is the best way to capture a few dollars of profit before we see the big next move. It is worth noting the bullish trendline that is visible on the 1 hour chart coloured green. As I write price is sitting on the trendline making its fourth touch so there could be an opportunity to achieve a short term profit via a bounce or break. The red horizontal line displays shorter term resistance at $1385 that has received 3 touches so far today so again look for bounce or breaks at this level.

Taking a longer term view from a technical perspective remember the two side by side shooting stars on the weekly chart which has now been followed by a bullish hammer. The shadows on the shooting stars are longer than the hammers shadow meaning the bears still have the upper hand so look for good entry levels to short if you don’t mind taking on the risk and volatility that will occur on Wednesday. Sometimes candlesticks do not have immediate effects but can influence price at a later date.

Market Analysis Tuesday 18th of June

ANALYSIS 18-06-2013

Kospi worry about Global Economy

Kospi fell as widespread concerns over global economic growth outlook. G-8 confirms outlook for the global economy remains weak despite slowdown risk has been reduced.

Technically, the index in the trading session today, Tuesday (18/06) likely to weaken, test negative trends, the impact of Wall Street. On the M30 chart bearish engulfing berformasi provide opportunities for the index to move downside. However, the volume is likely to increase, an early indication of bullish index. In addition, RSI, on the M30 chart, is in the oversold area, cue upside.

Expected, the index tested the first support level ie 241.16 and 238.37. If it fails at 245.55, then the next index is expected to tend to retest the 248.66 resistance level and continue up the possibility of being in the 251.55 area.

Stock Trading Session duration in Europe, Euro Steady Against U.S. Dollar

Trading foreign exchange on Monday the euro just naturally a little movement against the U.S. dollar as investors await the outcome of a U.S. Federal Reserve meeting later this week.

Technically, today’s trading session on Tuesday (18/06), the pair euro dollar likely to move in a positive trend.

A stronger Euro is mainly expected to soon re-test the resistance at 1.3541 minimum and maximum 1.3659. Meanwhile, if the Euro was unable to break and stays below 1.3357 then another alternative scenario the Euro likely to test support at the 1.3228 area and 1.3117.

Gold prices closed down to $ 1,383.10

Gold prices ended closed down after the broker more waiting to be ahead of the Federal Reserve’s FOMC meeting which will take place this week.

Technically, gold at today’s trading session on Tuesday (18/06) potentially bearish, test returned negative trend, but prone to reversal. RSI indicator tends to re-test support channel and towards the oversold area, but Bollinger Band which began to widen, thus giving impetus to gold to the upside.

Estimated gold price immediately prior to test support at least in the area of ​​1356.12 and re-test the maximum level of 1340.66. However, if the price of gold is able to break and hold above 1384.90 then estimated the price of gold could potentially test the Resistance 1404.16 and 1421.66.

XULF Weekly Report 17 – 21 June

XULF Weekly Gold Report

Last week was another week of sideways movement for gold showing good resilience against strong US Retail Sales and Jobless Claims. On Tuesday it looked as though the bears were finally getting a grip of this market as they forced down through a couple of support levels in the $1370’s to print a low of $1365.32. The fundamentals for gold are certainly bearish but this is being countered technically by the bulls wanting to push a bear trend correction and this is creating an equilibrium just under the $1400 level. The widely used term ‘tapering’, referring to the anticipated stimulus slowdown, has negative connotations for gold as the process should only be conducted in the presence of a healthy US economy and it will strengthen the US dollar making gold more expensive in other currencies but simultaneously gold is in demand to some degree because of the uncertainty of how the economies and financial markets will react when the tapering begins. However the Fed may continue with the bond buying for longer than expected and only withdraw when there are signs of inflation which would be ideal for gold as the removal of one catalyst will be replaced by another. Therefore the outlook for the rest of the year will be largely influenced by the presence of three factors; stimulus, uncertainty and inflation and taking into account these environments never seem to be far away gold should put up a good fight in the long term.

The weekly chart shows that gold could be close to deciding which way it wants to move from here and break out the $1350 to $1420 range. I have referred to the momentum indicator in recent reports as it is appropriate and very useful given gold’s circumstances at present. The indicator is pushing against its own bearish trendline which could prove to be a pivotal moment. If we see a break on the momentum indicator this would be bullish as it would be characteristic of the current trend having weakened and that the market is poised to reverse. On the contrary if we see a bounce on the indicators trendline expect to see more declines as the bulls lose confidence in trying to revive this once beloved commodity.

In the short term the best way to trade this market, taking into account the lack of direction, is to buy at support and sell at resistance. Support and resistance levels are formed when a price level receives a higher volume of buying or selling and this is often displayed by long shadowed candlesticks especially hammers and shooting stars. Bear in mind these levels on this 1 hour chart are only minor support and resistances as they have only had one instance of higher volume but nonetheless can be useful to capture a few dollars of profit. Look to sell at the yellow resistance and buy around the green support lines but be mindful of any news that may be moving price towards these levels because if the move is backed by news we could see price knock down these levels. If price approaches either of these levels in an absence of news and economic numbers then there is a stronger case for applying this tactic.

Important economic releases to watch out for this week include the German ZEW survey and US Inflation data on Tuesday. On Wednesday there is a German 10 year bond auction that will garner close attention and affect EUR/USD and at 19:00 GMT the FOMC express their views on the US economy and will give more clues as to when the tapering may begin or under what circumstances they will begin to act. There is German and US manufacturing along with US Home sales data Thursday and on Friday Bank of Japan’s Governor Kuroda speaks at a press conference.

Jalatama Loco London (XULF) Report 14/06/2013

Gold continues to show resilience taking into account the positive Non-Farms last Friday and now better than expected US Retail Sales and Jobless Claims. Yes there has been some selling off the back of these numbers but there is also clearly steady demand preventing the bears from dominating the market. As I mentioned yesterday there a various opposing forces impacting gold at present including the forthcoming withdrawal of stimulus and global growth concerns which is bearish whilst at the same time the uncertainty surrounding global growth is supporting gold at these levels.

Technically gold is the same as yesterday, and that is range bound with any trends ending rather quickly. Therefore traders who cannot wait until we have a breakout out of the triangle pattern shown on the daily chart yesterday can look for intra-day opportunities buying at support and selling at resistance levels. The 15 minute chart shows recent support and resistance levels that may provide a bounce opportunity to profit. Look to sell around the yellow resistance and buy around green support. It is paramount to assess whether there is any change in fundamentals or news headlines that is driving or dropping price before executing and try to incorporate bearish candlesticks to confirm the reversal.

This may mean you miss out on a couple dollars of extra profit but the confirmation is worthwhile forfeiting the extra profit. It is recommended not to use this strategy during economic releases so be aware of the US Producer Price Index at 13:30 GMT and Consumer Sentiment 14:55 GMT

Jalatama Loco London (XULF) Report 12/06/2013

XULF Report
Gold got wrapped up in the broad scale sell-off yesterday triggered by the Bank of Japan unveiling no additional stimulus measures and concerns about the legality of the ECB’s OMT programme. The precious metal has been well known as a good hedge against inflation and currency devaluations hence a withdrawal of money supply tends to cause investors to move away and go back to currencies. If the German Court Ruling over the constitutionality of the ECB’s unlimited bond purchases pledge is concluded as illegal then this could unravel all of Mario Draghi’s resolute hard work to lower bond yields of highly indebted nations.

The ECB hasn’t needed to activate the bond buying of its Outright Monetary Transactions programme but the pledge to make unlimited purchases has instilled confidence in the Euro which could be eradicated if the pledge isn’t supported by law. This will weaken EUR/USD and put heavy pressure on gold. Conversely a success for the ECB should give investors more appetite for gold. The poor Chinese trade data at the weekend is also dampening the mood for gold after further evidence points to slowing growth from the metals second largest importer.

The 15 minute chart displays how price has recouped much of yesterday’s losses to find resistance at the bearish trendline that began forming on Monday. Given the general descent since Friday this pullback towards this bearish trend offers a good opportunity to short with a tight stop. Remember that the weekly chart strongly indicates with the two side-by-side shooting stars that the market will finish the week down therefore most factors are bearish in the short term. A break of this trendline may produce an incline of a few dollars but bear in mind we need fundamentals somewhat to deliver gains of any substance. If the ECB wins its court case that may be the impetus gold needs.

Jalatama Loco London (XULF) Weekly Report 10 – 14 June 2013

Weekly XULF Report 10 – 14 June 2013

Gold was having a steady performance last week until a better than expected US Non-Farms on Friday gave good reason for investors to ditch safe havens for riskier assets causing gold to erase all of its gains on Thursday to reach a two week low of $1378.80. For much of the week gold was hovering around the $1400 level until ECB President Mario Draghi’s comments triggered a spike to $1421 after he informed the markets that the economy should stabilize and recover during the course of the year and that further monetary stimulus was not at the forefront of policymakers’ minds. Investors bought the Euro and aggressively sold the dollar on the back of these comments. Gold’s gains were eradicated 24 hours later when the US Non-Farm data showed that despite the mixed set of data recently the US economy is creating more jobs raising the probability of stimulus tapering occurring before the latter parts of the year.

The biggest drag on gold at present is the anticipation of the Federal Reserve slowing down the bond purchases which will strengthen the dollar making gold more expensive for investors using other currencies. Contrary to popular opinion gold may hold its ground and be tough for the bears to control for the rest of the year. Gold has already priced in a significant chunk of this expectation by declining nearly 20% this year therefore it would be foolhardy to take further declines for granted when the Fed begins the slowdown. If the Fed cuts back too sharply we could see a strong equity correction and some losses for gold but as investors take a look at the bigger picture they may switch to safe haven assets amid the uncertainty generated by the removal of stimulus on such an unprecedented scale. In the other scenario if the Fed play it in a way that appeases investors this should result in lower volatility for both gold and equities which would regenerate some confidence in gold and be supportive for a good finish by the end of 2013.

Technically gold has been showing signs of a possible bounce back towards the long term bearish trendline over the past three weeks but last Friday’s drop means the weekly chart is now displaying two consecutive shooting stars. The 10, 20, 50 and 100 Moving Averages aligned in descending order illustrates the market is far away from any correction but the higher low on the RSI indicates the pace of the decline is diminishing. Bulls will have been watching for a break of the bearish trendline on the momentum indicator but unfortunately for them Friday’s performance looks as though the momentum indicator is now bouncing off its own trendline ready for another downward leg. So to summarise the outlook for gold it looks like there will be a descent during June but at a slowing rate. Although traders need to be mindful of gold’s resilience of late in face of bearish fundamentals which hints that the market may be ready for a correction towards the long term bearish trendline within the next few weeks.

We have an eventful week with various types of data scheduled including Japan’s monetary statement and press conference Tuesday which is likely to move USD/JPY. On Wednesday and Thursday Germany are concluding a constitutional ruling on the ECB’s monetary operations which will impact gold by moving the EUR/USD, Thursday reveals US Retail Sales for May and on Friday is the University of Michigan’s Consumer Sentiment survey. Trade carefully around these numbers by using stop losses or reducing exposure.

Jalatama Loco London (XULF) Report 04/06/2013

XULF Report

After hovering in the $1390’s for most of yesterday gold had a surge reclaiming the $1400 mark last night spurred on by disappointing US ISM Manufacturing data that implied the Fed may postpone plans to reduce stimulus. The Fed wants to move on from the mixed bag of data at present before committing to winding down the programme which, in an odd way, means that poor economic numbers could lead to gains for equities and dollar-denominated commodities. USD/JPY dropped below the 100 yen level which also helped gold last night but given the overall fundamentals the pair are still well positioned to continue its bulls run driven by Japan’s aggressive QE plans and a buoyant stock market and the expectation that, even though there is mixed data from the US, a slowdown in stimulus is on the horizon and this will put pressure on gold in the long term.

Despite the volatility price is trading along a medium term bullish trend line on the 4 hour chart, although do bear in mind many bullish trendlines that have been drawn since $1338 level on 20th May across different timeframes have had to be redrawn because of erratic price movements therefore trade this trendline with caution. The angle on the trendline is mild enough to be sustainable however the heightened volatility signals the trend is weak. The latest 4 hour candlestick is printing as a harami offering an early sign for a short pivot trade but given the volatility consider shorter targets. The obvious target level is $1400 as there might be some buyers around this level and place a tight stop loss just above this morning’s of $1415. The medium term outlook is more bullish for gold as the 50 period MA is currently intersecting with the 100 period MA. If this crossover completes consider long trades as price bounces around the bullish trendline.

The economic highlights today are the Spanish Unemployment at 3pm and US Trade Balance at 8:30pm which is likely to impact the dollar and consequentially the gold market.

Jalatama Loco London (XULF) Weekly Report 03 – 07 June 2013

XULF Weekly Report 3rd June to 7th June

Last week was a strange week for gold. It finally broke through $1400 after numerous attempts over a 2 week period reaching a high of $1421.80 last Friday and then it seemed as though the bulls simply handed over all their hard work for the bears to take control again forcing it aggressively back below $1400. Gold’s rise until Friday was driven by some uncertainty creeping in regarding growth outside the US following the IMF and OECD reports and the market looking like it was ready to make a technical correction in its bear trend. However clearly the majority of shorting participants seem to be longer term and weren’t affected by the $1400 resistance break and hence added to their positions eradicating all the gains within a few hours. Interestingly USD/JPY, which has had stronger than normal inverse correlations to gold since the launch of Japan’s new QE programme, also dropped showing gold fell out of favour despite the dollar weakening which does not bode well for the metal. We could to see some dollar strength this week as USD/JPY finds support at the psychologically important level 100 yen and as the market anticipates ECB Mario Draghi to be unable to put any kind of positive spin on the Eurozone’s dire recession hit economy when he speaks after the rate announcement Thursday which will put pressure on the EUR/USD. Therefore considering probable dollar strength this week gold might be under more pressure. Gold’s destiny for the rest of the year is very much dependent on how equity markets react to the Federal Reserve’s management of tapering the unprecedented stimulus and how they manage market expectations. Gold has already factored in much of the Fed’s forthcoming tapering of stimulus but equities clearly haven’t which indicates equities could do worse than gold when the Fed finally begins to reduce the programme. It’s also worth noting that if we do see an equity correction gold may even benefit contrary to the consensus opinion as investors diversify and add commodities to their portfolios.

From a technical perspective gold is at a crossroads with conflicting data across different timeframes. The daily chart shows Friday’s candlestick was very bearish engulfing the prior day’s gains however the 10 day MA is currently intersecting with the 20 day MA which signals possible upward momentum. If we get a firm crossover from these 2 moving averages the bulls hope of a sustained correction may still be on the cards. Although the recent increase in volatility isn’t good for the bulls as volatility is usually associated with bear trends therefore any bulls should re-evaluate if we see further erratic price movements.

This week has a very busy economic calendar including US ISM Manufacturing tonight at 10pm, US Trade Balance 8:30pm Tuesday, Italian and Spanish Services PMI data Wednesday afternoon, the ECB’s rate announcement at press conference starting 7:45pm Thursday night and culminating in the US Non-Farm payrolls 8:30pm Friday night. Evidence that the US is creating more jobs and can feasibly lower unemployment towards pre-recession levels will cause whipsaw effects on gold as investors weigh up the impact on the equity markets therefore trade very carefully around this number.

Market Analysis Friday 03th of June

ANALYSIS 03-06-2013

Nikkei Closed Stronger, But Rally For 9 Months Ending

The Nikkei closed up 1.4% to 13,775, after falling 5.2% yesterday. But this month, the Nikkei declined for the first time since last 9 months, the Nikkei fell 0.6% this month. While the Topix adding 0.1%.

Technically, the index in the trading session today, Monday (03/06) is likely to strengthen, test positive trend. On the M15 chart bullish hammer berformasi provide opportunities for the index to move upside. However, the volume is likely to increase, as well as an early indication of a bullish index. In addition, RSI, on the M15 chart, is in the oversold area, cue upside.

Expected, the index tested the first resistance level of 14171 and 14611. If it fails in 13525, we then estimated the index tends to retest the support level of 13036 and continued up to the possibility of being in the 12610 area.

Euro Gains, ECB Expects Positive Signals

Euro in trading last week generally observed trend higher against the U.S. Dollar. Trade the currency pair EUR / USD is in the range of 1.2935 after opening at the beginning of the trading week has climbed about 62 pips or about + + 0:47% and closed at around 1.2997.

Technically, today’s trading session on Monday (03/06), the pair euro dollar likely to move in a positive trend.

A stronger Euro is mainly expected to soon re-test the resistance at 1.3138 minimum and maximum 1.3230. Meanwhile, if the Euro was unable to break and stays below 1.2992 then another alternative scenario the Euro likely to test support at the 1.2859 area and 1.2759.

Gold Drops the Most in 2 Weeks as Fed stimulus speculation

Gold futures fell the furthest in 2 weeks with the U.S. consumer confidence rose in May, the highest in nearly 6 years, sparking concern the Federal Reserve will keep monetary stimulus

Technically, gold at today’s trading session on Monday (03/06) potentially bearish, test returned negative trend, but prone to reversal. RSI indicator tends to re-test support channel and towards the oversold area, but Bollinger Band which began to widen, thus giving impetus to gold to the upside.

Estimated gold price immediately prior to test support at least in the area of ​​1365.27 and re-test the maximum level of 1347.06. However, if the price of gold is able to break and hold above 1393.20 then estimated the price of gold could potentially test the Resistance 1417.28 and 1437.43.

Jalatama Loco London (XULF) Report 31/05/2013

XULF Report

Finally gold bulldozed its way through the mighty $1400 resistance yesterday but did have a dip back below after Italy’s borrowing costs increased in a 10 year bond auction. Although the uptrend did resume helped by a slightly downwardly revised US GDP number that weakened the dollar against most major currencies. Japan’s stimulus programme continues to pay dividends evident in Industrial Output that was more than double estimates and this has provided a bit of support for gold in its newly found uptrend.

As I write the market on the 30 minute chart is tinkering on the overbought territory according the RSI so be aware of possible pullbacks. The bulls will have more confidence now the formidable $1400 level has been broken therefore pullbacks present good long opportunities. Any bounce off the bullish trendline illustrated by the red line offers a good low risk entry. If price pulls back and breaks the trendline this would indicate the trend maybe weakening. Fibonacci Retracement levels are very useful for assessing the strength of a trend and when it has come to an end. Often if price retraces and breaks the 61.8% Fib level this indicates the current trend is very weak and the market will probably become range bound. The 61.8% fib level of this trend is at $1397.50 therefore a dip back below this would probably end the bulls hope of a continuing trend and more highs in the short to medium term. We are currently experiencing minor resistance at $1420 which was previous support that was broken on 10th May after a move through this level target levels are $1445 and medium target is $1488 that is the neckline of a potential double bottom on the daily chart. The main data to watch out for today are German Retail Sales at 2pm and US Income and Spending at 8:30pm.

Market Analysis Friday 31th of May

ANALYSIS 31-05-2013

The Nikkei index weakened due to strengthening Yen against Dollar

Japanese stock exchange to trade Thursdays yesterday recorded a significant decline. Weakening exchange movement was caused by a decline in the shares of exporters that are not caused by the strengthening of the yen against the U.S. dollar, but also due to the decline in sales turnover reports Honda Motor fell 3.4% in the first quarter ago.

Technically, the index on the trading session today, Friday (31/05) chance to weaken, test negative trends, browse Wall Street. On the bearish engulfing formation M15 chart provides an opportunity for the index to move downside. However, the volume tends to rise, early indications bullish index. In addition, RSI, on the M15 chart, selling in saturated areas, signal upside.

Partly, the index test in advance Support level ie 12910 and 12326. If failed in the 13835, the estimated index tend to test further back resistance level that is 14 465 and the possibility of being extended to 14 990 in the area.

Industry performance Chance Rise, Yen strengthened

Movement of Japanese yen in forex trading this morning (05/31) observed indicate movement strengthened against the U.S. Dollar. USDJPY currency pair opened at 100.91 in early trading range (00.00 GMT) and then down around -14 pips or about -0.13% and the rolling observed in the 100.77 range. This indicates strengthening of the U.S. Dollar versus the Yen.

Technically, today’s trading session on Friday (31/05), the dollar yen pair had the opportunity to move in a positive trend.

Strengthening of yen mainly predicted back soon test resistance at 102.67 ie the minimum and maximum of 103.80. And as, if not able to break yen and 100.93 survive under the alternative scenario that is another chance to test Support yen at 99.67 and 98.63 area.

Gold price pierces $ 1.400 per ounce by the weakening U.S. dollar

The U.S. dollar weakened in trading Thursday (30/05) depressed U.S. economic data indicate growth in the first quarter is not as good as previously reported, except that there is an increase of unemployment claims. This is the key driver of gold prices this time to penetrate the highest price in two weeks.

Technically, gold trading session today, Friday (31/05) reversal potential, tested positive trend, but prone to profit taking. RSI indicators tend to re-test resistance bullish channel and head area, but Bollinger band began to shrink, giving impetus to gold to the downside.

Chance of gold price immediately prior to test resistance at least in the area and re-test 1443.33 maximum level of 1465.18. But if the price of gold can not afford to break and survive under 1415.25 then predicted the gold price potentially testing Support ie 1391.88 and 1370.74.

Jalatama Loco London (XULF) Report 30/05/2013

XULF Report

Writing this report this week feels like a broken record as it is just a repeat of previous analysis because the market continues to be range bound. The Organization for Economic Cooperation and Development lowered global growth forecasts and the IMF cut its growth estimate for China making investors trim down risk in equity markets. It does make one doubt the sustainability of the US equity rally if there is no growth or slowing growth elsewhere around the globe. Contrary to popular belief if we do see an equity correction triggered by global growth concerns and a tapering of stimulus gold could make some gains as fund managers diversify into commodities to manage the risk and uncertainty.

Gold is again hovering a few dollars under $1400 and has tested as high as $1397.80 this morning but has been beaten away by the bears for the umpteenth time. The 30 minute chart shows a bullish channel that developed yesterday which manifests the short sentiment. A sharp spike up in price seems to be easily defended by the bears therefore a good indication of a much awaited breakthrough will be if price steadily raises at a sustainable gradient and we see tight consolidation just under $1400. When taking into account the potential rewards of an upward breakout attributed to the prolonged building of pressure mainly between $1380 to $1400 it is worth taking a risk and buying on a pullback. The logical level for a stop loss is below the previous higher low of $1388 which is also below the bottom side of the channel. Short opportunities will arise if Tuesday night’s low of $1373 is broken. The reports to watch out for today are US GDP at 8:30pm and US Pending Homes at 10pm which could shift this static market if the technical fail to.

Market Analysis Thursday 30th of May

ANALYSIS 30-05-2013

HK Shares End Lower Depressed Profit Taking

Hong Kong shares ended lower on Wednesday on profit taking after two days of gains, and investors remain cautious on the outlook for the Chinese economy.

Technically, the index in the trading session today, Thursday (30/05) likely to weaken, test negative trends, the impact of Wall Street. On the bearish engulfing formation M15 chart gives an opportunity for the index to move downside. However, the volume is likely to increase, an early indication of a bullish index. In addition, RSI, on the M15 chart, is in the oversold area, cue upside.

Expected, the index tested the first support level ie 22110 and 22023. If it fails in 22238, we then estimated the index tends to retest the resistance level of 22351 and continued up to the possibility of being in the 22443 area.

Euro Helped German Inflation Data

The euro turned higher against the U.S. dollar after data showed German inflation that exceeded expectations. Inflation in Germany drove at an annual rate of 1.5% in May, faster than the estimated 0.2%.

Technically, today’s trading session on Thursday (30/05), the pair euro dollar likely to move in a positive trend.

A stronger Euro is mainly expected to soon re-test the resistance at 1.3120 minimum and maximum 1.3235. Meanwhile, if the Euro was unable to break and stays below 1.2945 then another alternative scenario the Euro likely to test support at the 1.2820 area and 1.2709.

Gold Up On Strong Demand Physical, Decrease in Equity

Gold rose around 1% on Wednesday, reversing losses from the previous session as the decline in the dollar and equities decline sparked buying of physical gold.

Technically, gold in the trading session today, Thursday (30/05) potential reversal, tested positive trend, but prone to profit taking. Indicator RSI resistance likely to re-test the bullish channel and into the area, but the Bollinger Bands are starting to shrink, thus giving impetus to gold to the downside.

Estimated gold price immediately prior to test resistance at least in the area of ​​1435.33 and re-test the maximum level of 1458.96. However, if the gold price could not break and stays below 1391.25 then estimated the price of gold has the potential to test Support the 1363.65 and 1337.65.

Jalatama Loco London (XULF) Report 29/05/2013

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.

Jalatama Loco London (XULF) Report 28/05/2013

XULF Report

Gold continues to be stuck in the $1382 to $1400 range building the pressure for a substantial breakout whenever that may occur. The bulls have attempted to test $1400 several times now but the wall of resistance seems to be too thick as there are minor resistances from $1397 to $1401 collectively building a very strong defence line for the bears. China’s Premier comments regarding the huge challenges his country faces amid slowing growth is another potential black cloud hanging over the equity rally causing investors to pause for breath and keep most markets range bound. It really feels like gold needs something to push its way out of this range, either to the upside or downside, as it has become clear the bulls need some impetus to push through $1400 whilst they are being too stubborn to step aside and let the bears win. That impetus could emanate from the US Consumer Confidence tonight at 10pm. A disappointing result should spark an equity sell-off and force gold up through $1400. On the contrary a good number is likely to cause the opposite effect and drop gold lower. The improving housing market in the US has increased consumer net wealth and showed signs of increases in consumer confidence and spending therefore the market will be eagerly anticipating more evidence of this.

From a technical perspective the setting is more bullish than bearish but this all depends on an upside breakout through $1400. The daily chart shows how the medium term bearish trend has lost momentum displayed by the lower pain momentum indicator that has broken its own trendline and price has now formed into an ascending triangle. This triangle pattern will have little value unless price breaks the upper side at $1400 but if it does it could yield significant price appreciation over the medium term. Do bear in mind that this ascending triangle isn’t in perfect set-up conditions as the usual set-up is for it to appear during a bull market however they can still produce good results in or after bear markets too. The market is likely to stay quiet until US Consumer Confidence tonight and if the result is a considerable difference to forecasts this could be the turning point for gold.

Market Analysis Tuesday 28th of May

ANALYSIS 28-05-2013

Kospi Index Closed Up, Led To 2000 pts

South Korean stock market on Monday closed up and managed to escape from loneliness due to weakening trade due at least global fundamental data released earlier this week.

Technically, the index in the trading session today, Tuesday (28/05) is likely to strengthen, test positive trend. On the bullish hammer formation M15 chart gives an opportunity for the index to move upside. However, the volume is likely to increase, as well as an early indication of a bullish index. In addition, RSI, on the M15 chart, is in the oversold area, cue upside.

Expected, the index tested the first resistance level of 260.53 and 261.78. If it fails at 258.80, then the next index is expected to tend to retest the 257.44 support level and continue up the possibility of being in the 256.27 area.

Dollar Yen Hovering Low, Focus Data U.S.

In trading on Monday, the opening price of USD / JPY at 101.08. The movement of this currency pair narrow natural increase, strengthening begins to peak levels at 101.22 and then pulled back up to the basic level of 100.73. Closing price at 101.06, marked by long-legged doji candle.

Technically, today’s trading session on Tuesday (28/05), the dollar yen pair has a chance to move in a positive trend.

A stronger yen primarily expected soon reexamine the minimal resistance at 102.88 and 103.75 maximum. Meanwhile, if the Yen was able to break and stays below 101.62 then another alternative scenario that is likely to test support Yen’s in the area of ​​100.79 and 100.01.

Gold Recovers from the ground up

Gold changed direction and jumped back over the last week. Recovery of gold and silver along with the appreciation of major currencies like the Euro and the Japanese Yen against the U.S. Dollar.

Technically, gold in the trading session today, Tuesday (28/05) potential reversal, tested positive trend, but prone to profit taking. Indicator RSI resistance likely to re-test the bullish channel and into the area, but the Bollinger Bands are starting to shrink, thus giving impetus to gold to the downside.

Estimated gold price immediately prior to test resistance at least in the area of ​​1424.09 and re-test the maximum level of 1447.54. However, if the gold price could not break and stays below 1391.50 then estimated the price of gold has the potential to test Support the 1365.81 and 1347.34.

Eight smart trades if China goes bust

French bank Société Générale outlined Tuesday what it said was an unlikely but not out-of-the-question scenario of a disastrous “hard landing” in China.

While not its base case (SocGen thinks China’s economy will grow 7.3% this year), the bank said it was concerned global investors were too complacent about everything working out smoothly for the Chinese economy. Its own survey found that most respondents thought the “worst reasonable case” for Chinese growth this year was a slowdown to growth of between 5.5% and 7%.

However, there are concerns that things could go wrong. Continue Reading...

From MarketWatch by Chris Oliver