Gold has been our focus for several posts in the past as we believe that another big move upwards is expected during 2013. We believe that during the first quarter, Gold will have a clearer picture as to where it is heading. The updated chart of daily candles in Gold is posted below.
As mentioned in previous posts, important resistance was the 1690-1700 area. This is not only the area of the downward sloping red triangle but also the resistance level. Prices got rejected several times at that price area and it was suggested that short positions would give us profits if prices did not manage to overcome resistance. Now prices trade almost 50$ lower. This drop in prices could continue to 1610-20$ area. But one thing is still certain. Above 1700$ prices are going to rally hard.
Concluding, we keep an eye for Gold and we would certainly consider buying above 1700. Picking a bottom would be dangerous but could prove extremely profitable if we nail the bottom at 1610-20 area. Keep an eye for gold this year.
As always, thank you for taking the time to read my post.
A chart used in technical analysis that shows support and resistance, and momentum and trend directions for a security or investment. It is designed to provide relevant information at a glance using moving averages (tenkan-sen and kijun-sen) to show bullish and bearish crossover points. The "clouds" (kumo, in Japanese) are formed between spans of the average of the tenkan-sen and kijun-sen plotted six months ahead (senkou span B), and of the midpoint of the 52-week high and low (senkou span B) plotted six months ahead.