Our 2013 prediction for GOLD (and some other financial markets) has been posted on our website at this link. Events early in the year tend to confirm our outlook; we think our downside targets will be hit, step by step.
Last week GOLD dropped sharply in reaction to the release of the FOMC
minutes, with some Fed members willing to end the bond purchase program
earlier than previously thought. GOLD dropped into the first monthly
support around 1625 area Thursday and early Friday morning before making
a technical oversold bounce. This week, we are likely to see GOLD make a
consolidation move.
There is an unfilled gap between 1664.50 (Friday’s high) and 1674.60.
This unfilled gap will be very important for the next leg down. As long
as this gap remains unfilled the short-term downside trend will
continue. The 1660 to 1620 range could become this week’s consolidation
range. A move under 1612.50 level will give odds the impression that a
further drop to 1590-1586 will be next.
Daily Outlook
The daily chart shows the situation in greater detail. The major resistance
level for the short-term downtrend is around 1715-1700 zone. Below that
there are two additional resistance levels at 1693.20 and 1679, which
probably will prevent GOLD from moving up. Therefore we should look for
short side entries when the price tries to bounce this week.
1665-60 is the key area for this week. If we fail to move above this range,
GOLD will fall back down to 1635-33 or lower to 1624-20 range for
testing.
To see the full analysis, including the buy and sell levels, follow this link.
