After a stronger than expected Non Farms Payroll number from the US on Friday, gold fell in the afternoon session, finding support at 1456 before recovering a little to close the week at 1470, forming a "doji" candlestick on the weekly chart.
Yesterday saw a quiet day of trading due to the Bank Holiday in the UK, however this morning gold is under pressure again and retesting Friday's lows.
The 1475-1485 resistance area is proving too strong for gold to break through and we consider the likelihood of further declines to be significant from here. The rebound from the lows at 1322 has been stronger than we were expecting, though it appears that the bulls have finally run out of steam and, unless 1485 is broken decisively soon, a sell off is highly likely.
Oil found resistance above $97 and has reversed sharply - it is possible that a top in oil is forming at this level.
A major equities rally would be bearish for gold, as the recent strength in equities has been diverting funds away from commodities and precious metals in particular. Investors are looking for returns and equities are currently offering both capital growth potential and dividend payments, something gold cannot offer.
The dollar is still being capped below resistance at 84, though again a breakout above this level will be bearish for gold.
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.
King Regards
