Golden Bulls – Is this Idol Worship?
October 21st, 2009 Posted in Oil and Precious Metals
We are continuing to watch Gold in this week’s analysis since the precious metal has continued rising to record highs. If you weren’t watching, Gold has risen from around $700 an ounce back in November of 2008, to almost $1100 an ounce today. Gold reached a record high mark of $1070.55 per ounce and has momentarily entered a downward correction. The question now is, will this upward trend continue following yesterday’s bearish move? OR, is the upward momentum finally running out?
Heading into the holiday season in the US, Canada, and Europe means that jewelry sales will likely increase and put artificial upward pressure on Gold prices. Many forecasts call for a price level near $1,100 an ounce, but speculators are getting hesitant about such a high price and are beginning to increase the size and duration of the bearish corrections. We’ll have to wait and see if the bulls can overtake the bears in today’s trading to determine the trend for the rest of the week.
For technical analysis on Gold prices, see the information below:
- The chart below is the weekly chart on Gold by ForexYard.
- The indicators used are the MACD/OsMA and Stochastic (slow).
- Point 1: Over the last year, the price of Gold has experienced a long, drawn-out consolidation trend. It is heading for a point now, which means a sharp volatile movement will likely occur in the next week or two.
- Point 2: The MACD is showing a series of bearish crosses, but very close to the 0 line, meaning there is not much downward pressure, but just enough to extend the recent correction slightly further.
- Point 3: The Stochastic (slow) also shows an impending bearish cross which, actually, refers to a future bearish movement.
- As can be seen, there does not seem to be much downward pressure on this commodity at the moment, which suggests that Gold prices may continue upwards in the near future before falling, likely sometime next week.
- If, however, the holiday season does play a heavier role in Gold trading, then the consolidation point could see a sharp upward movement as well. For now, we can anticipate the short bullish momentum remaining throughout this week.
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Tags: Au, Commodities, commodity trading, Forex, forex tips, Forex Trading, Gold, Gold forecast, gold idol, gold price, Gold trading, golden bull, golden calf, idol worship, precious metals
