Candle Pattern Is Warning Of Further Downside For Gold Price



















A stronger US dollar has also pressured gold prices this morning. The greenback strengthened from USD1.4720 to USD1.4563 against the euro in Asian trade before retreating to USD1.4636 in European trade. Consequently, gold slipped from USD996 to USD986 in Asian trade before recovering. Gold’s recent weakness has attracted some fund buying interest—of note, ETF Securities Ltd increased its gold investment holdings 13,000oz to a record 8.39 million ounces today. Increased investment fund flows may see gold continue to garner support should prices weaken further. Resistance is at USD996.

Technical Commentary
Gold—The broader gold uptrend remains in tact, however shorter term technicals are warning of further downside for the metal. The MACD has crossed below the signal line, generating a sell signal; and the candle pattern is warning of further downside. However, gold has yet to even test its 50 or 100-day moving average (967.33 and 953.30, respectively) and these levels should serve as support.

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