Gold Analysis – Gold Falls Under $1,600 For First Time In Six Months
by Nick Simpson, Forex-FX-4X
The price of gold has fallen under the $1,600 per oz level for the first time in six months as the precious metal appears to be without a clear driver to bring a near term upside scenario. Our previous update highlighted a breakout under the triangle consolidation support area and there has subsequently been an extended downside move, with little in the way of a corrective move higher.
The move has seen gold drop around $40 per oz and bullion prices decreased around 3.7% on the weekly basis, the most significant decline in the price of gold since last May.
From a sentiment perspective, regulatory filings released on Thursday revealed that large funds, including Soros Fund Management, have cut their holdings of gold ETF’s (exchange traded funds) during Q4 2012, this is adding to the current broad based negative sentiment towards gold.
The previous lows, around the $1625 mark, are now eyed as potential near term resistance on any corrective move to the upside. The latest COT report update shows large speculators cut the open net long gold (CMX) position from 137k to 126k.
You can find our regular gold technical analysis updates here.
Click on chart for larger image.
Gold Technical Analysis – D1 chart
Leave a Reply