Commodities Market: Technical Outlook
October 05, 2011
R2=1718.33
R1=1674.21
PP=1634.98
S1=1590.86
S2=1551.63
Gold after hitting a high of 1678.69$, slid down to close on a negative note at 1619.99$, a loss of 33.20$. Currently, gold is facing strong resistance of the 100-DMA standing at 1670$. Further, the 14-DMA has just cut the 100-DMA from above which is a bearish sign. If gold extends the decline, the likely target will be at the 200-DMA standing at 1568$, which could later extend to 1532$ mark. In addition, the MACD has continued to move down supporting the bearish view.I suggest investors to view any upside as an opportunity to ‘Sell’, keeping stoploss above the 14-DMA. The support and resistance are lined up at 1611.15$ and 1645.33$, respectively.
Fundamental:
Gold futures gained 1% to above $1,630 an ounce on Wednesday, driven by a return to bargain hunting after prices dropped the previous day, while a rebound in the euro against the U.S. dollar also spurred buying. But another round of selling in equities could cap gains, as bullion's unpredictable behavior in recent weeks suggested the metal was unsure about its role in the financial market despite lingering worries about the debt crisis in Europe.
Gold futures gained 1% to above $1,630 an ounce on Wednesday, driven by a return to bargain hunting after prices dropped the previous day, while a rebound in the euro against the U.S. dollar also spurred buying. But another round of selling in equities could cap gains, as bullion's unpredictable behavior in recent weeks suggested the metal was unsure about its role in the financial market despite lingering worries about the debt crisis in Europe.
By
M.Zohaib Gadit
Forex Trading Consultant
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