INTERMEDIATE TERM TREND: NEUTRAL
SHORT TERM TREND: BULLISH
VERY SHORT TERM TREND: BULLISH
In our previous blog entry we noted that we expected gold to bounce from the lows around 1140, with an initial target of 1180. We have now exceeded this target, with the next Fib level at 1206 our next target for this counter trend rally.
Despite the recent rally, gold remains in an intermediate down trend, with a break of 1270 required to alter this position. However, there is plenty of room for the RSI to move higher and the impulsive nature of the rally suggests the price has some way to go yet.
After a shallow correction, equities have recently made new all-time highs, however the dollar has corrected sharply after a parabolic rise above the 100 level. This tumble in the dollar has boosted gold’s appeal and shows no sign of bottoming yet. The down trend in oil has slowed, with the price climbing back above $47 a barrel after making new multi-year lows.
Support can be found at 1180-1182, 1168, 1160, 1143-1146, 1131, 1124, 1100, 1085, 1045, 1000, 950, 867 and 806. A break of 1131 would be very bearish for gold and suggest a return to 1000-1050 in the first instance.
Resistance can be found at 1191, 1200, 1206, 1209, 1220-1223, 1252-1256, 1274, 1285, 1297 and 1305-1308. After a promising move higher following the break of 1180 last year, gold has failed to break the intermediate down trend and is now heading lower again, with the 2014 lows in sight.
Today's video for subscribers looks at the recent trading in more detail and our strategy for today's trading session.