Long Term ~ Neutral ~ need a monthly close above 1800 to confirm the bull market final phase underway
Medium Term ~ Bearish - Need a close above 1461-1529 to neutralize.
Intermediate Term ~ Bullish– Need to hold above 1320-1325 weekly. A close below 1272 would return to neutral mode. Support 1350. Above 1350 bullish.
Short Term ~ bullish– Price has reached resistance at 1434 --- and found support at 1372. Additional support at 1350 and resistance at 1420-1430. Short term cycle due to peak this week.
Support and Resistance
Initial Resistance 1420-1426 and 2nd tier 1433-1445
Initial Support 1390-1399 and 2nd tier 1376-1386
CME GROUP NEWS
Thee gold market rejected a very aggressive overnight washout on the charts and ultimately managed to return to positive ground. The initial recovery in gold was inspired by suspect talk of a missile launch from Russian sources but later on gold seemed to garners fresh lift from better than expected US data flows. In short, gold almost appeared to be behaving like a physical commodity market facing a global recovery. Even more impressive is the fact that gold managed the recovery action today in the face of adverse currency market action. While Syrian issues might simmer for the coming week, few expect that situation to remain calm for long. So far, news flow for South Africa regarding mining strikes hasn't been given that much credence by the trade perhaps because some traders think the government will force some type of compromise. Some players have even suggested that the loss of gold production won't be taken seriously by the market unless there is violence and destruction between the two sides.
Gold Technical
Gold pulled back to the 1372 channel line and 38% Fib retracement and bounced back hard on Tuesday and rallied back to the blue resistance line on the chart. The 1417-1425 area is resistance on Wednesday. A close above 1425-1435 allows for further upside towards 1460-1480. Short term cycles are due to peak Sept 3rd (plus or minus 72 hours). Thus it is still possible for gold to peak this week and pullback towards the 17th-21st of the month. September is usually a strong month for gold but there is a consideration that July and August were strong and there is a potential that gold’s seasonal rally was early this year as was the case in 2011. Until we break below 1372 the potential to stay in an uptrend can’t be removed.
Gold overview
Gold rallied with good economic news once again keeping the view we have that gold wants a global recovery and is not interested in more bailouts and printing. If those things were gold bullish there would not have been able to have been such a selloff….manipulations or not. While we’ll be the first to admit that the economic statistics we see in USA are so skewed its almost laughable, we contend that gold is better served with recovery in global conditions and not defaults. Indeed we favor that defaults like Cyprus are bearish for gold because they invite a global liquidity squeeze where all assets come under pressure to raise cash as was the case in 2008.
While the situation calmed down over Syria and there has been back sliding by the President, the following should be considered.
Syria
By Michael Snyder
September 03, 2013 "Information Clearing House - Russia has sold Syria highly advanced rocket launchers, anti-aircraft missiles and anti-ship missiles. In fact, the P-800 Yakhont anti-ship missiles that Russia has equipped Syria with are the most advanced anti-ship missiles that Russia has. When the United States strikes Syria, they might be quite surprised at how hard Syria can hit back. The Syrian military is the most formidable adversary that the U.S. military has tangled with in the Middle East by far. From Syria, P-800 Yakhont anti-ship missiles can cover much of the eastern Mediterranean and can even reach air bases in Cyprus. If the U.S. Navy is not very careful to stay out of range, we could easily see footage of destroyed U.S. naval vessels sinking into the Mediterranean Sea on the evening news. And once the American people see such footage, it will be impossible to stop a full-blown war between the United States and Syria.
Syria has highly advanced weapons systems that Afghanistan, Iraq and Libya did not have. Anyone that thinks that we can just sit back and lob cruise missiles at them is being naive. Syria has weapons that "have never before been seen" in the Middle East. The following is from a recent article by Mac Slavo...
According to the report from Syrian-based Dam Press and the Dyar Newspaper, the Russians aren’t backing off their Syria policy and they are getting ready to double down by supplying Assad’s military with weapons they have never before been seen in the Middle East.
If and when Western forces engage the Syrian army you can be assured that it will be nothing like the 1991 conflict in Iraq when a hundred thousand of Saddam Hussein’s soldiers surrendered without firing a shot. Nor will it be a no-fly zone free-for-all where air forces will be able to target military assets as they did in Libya without being challenged.
End of article
While gold rallies early in these conflicts and tends to sell off hard afterwards, one has to wonder if the USA got a shellacking in one of these incidents if there would not be an opposite effect.
The real problem is the USA has a major budget battle coming in September and a potentially slowing economy and its hard not to suspect this is the old game plan of let’s deflect all the issues and go to war. Then the Fed would have no choice but supply all the more printing needed. It may put things aside for a while but the debt load would most likely be the straw that breaks the camel’s back.
KEY RESISTANCE and Pivot POINTs for the WEEK
R1 and R2 are 1 and 2 standard deviations of resistance to the pivot point and S1 and S2 are supports of 1 and 2 standard deviation.
Last week’s numbers to watch was 1420-1430. (HIGH LAST WEEK WAS 1434)
This week’s number to watch is the same, 1420-1430 and 1445-1455.
NOTE: new numbers out for the monthly (and weekly).
Gold Hourly Chart
Gold plunged early this week to key support at 1372 and then spent Tuesday retracing a majority of last week’s loss. We came right back up to resistance at the mini blue line on the chart at 1417 and it remains to be seen if we move higher again into mid week Wednesday. The huge money flow out of Asian stock and currency markets due to the “TAPER TANTRUM” initiated by the FED has produced major market and currency moves as we highlighted on the weekly report and the Ambrose Evans Pritchard article. At the moment the US Dollar and gold are now moving higher and it remains to be seen if both are now joining hands in a move higher. For gold the next resistance is 1420-1425 and 1433-1443. If we penetrate the blue mini line (which was resistance today) then the dual white lines again come in play at around 1423 to 1437. A close above the dual white lines will favor higher prices to the yellow line at around 1445-1450. The overall trend remains up. It’s just a question of whether the short term cycles kick in or not.
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YOU SHOULD NOT TAKE ANY MATERIAL posted on this BLOG AS RECOMMENDATIONS
TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED.
TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED.
Do your own due diligence.
No one knows tomorrow's price or circumstance.
I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader.
I do not accept responsibility for being incorrect in my speculations on market trend.
I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader.
I do not accept responsibility for being incorrect in my speculations on market trend.
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