INTERMEDIATE TERM TREND BEARISH
SHORT TERM TREND BEARISH
VERY SHORT TERM TREND BULLISH
We said in last week’s blog that gold was clearly attempting to form a base for a rally back up to 1130-1140 and this appears to have been a correct call. After successfully testing 1080 as support on three separate occasions last week, gold broke out above the 20 DMA at 1102 and has hit a high of 1120 this morning. The price is also well above the 80 hour and 200 hour MAs which have both now turned upwards.
The 1130 level will provide strong resistance after being major support for so long and a break above this level targets 1150. We do not expect a rally much higher than 1150, as the bears remain in complete control with 1000-1050 still the near term target.
Equities remain weak as the uncertainty in China weighs on prices, whilst oil has stabilised with the price climbing back up towards $50 a barrel after a prolonged sell off.
Support can be found at 1102, 1094, 1082-1080, 1074, 1045, 1000, 950, 867 and 806. The break of 1130 is very bearish for gold and suggest a return to 1000-1050 in the first instance.
Resistance can be found at 1120, 1130, 1142, 1147, 1163, 1170, 1175, 1184, 1204, 1208-1210, 1215, 1220-1223, 1235 and 1252-1256. Gold has broken below the 2014 lows and looks be headed much lower.
Today's video for subscribers looks at the recent trading in more detail and our strategy for today's trading session.