INTERMEDIATE TERM TREND: NEUTRAL/BEARISH
SHORT TERM TREND: BEARISH
VERY SHORT TERM TREND: BEARISH
Gold tumbled late yesterday after what was perceived to be a hawkish FOMC statement, suggesting that the strength of the US economy will result in interest rate hikes next year. This upbeat economic assessment took markets by surpise and seems at odds with the recent financial data from the US that has been less than impressive.
The dollar surged higher and this morning, gold has continued to fall and is trading just above 1200, whilst the dollar is trading well above 86.
There is now very little support before the major 1180 level in gold, the bears will feel they have the momentum to finally smash through tihs key level and take gold all the way down to 1000 in the resulting sell off.
Support can be found at 1203-1205, 1200 and 1180-1183. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term - the failure to break the 65 week MA and the break down of the triangle pattern on the daily chart makes this scenario much more likely, particularly as gold has now reached and tested this crucial support level.
Resistance can be found at 1217, 1225, 1232, 1235, 1250, 1255, 1263, 1271-1273, 1290-1292, 1300-1302, 1310-1312, 1322-1325, 1333-1335 and 1345. A second failure to break through the key 65 week MA confirms that the intermediate down trend is intact and a retest of 1180 suggests a break of that level is likely.
Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.