Gold prices have shed nearly 10 percent since their high on February 20, and it appears that there are lower prices to come for the time being. Investor interest in the Gold ETF is waning, and volume on the ETF has risen as its price has fallen, a bearish sign. Let’s look at the futures chart.The Feb. 20 high formed a double top with the high from July 2008, as gold managed only one close above $1000.A breakout day selloff on Feb. 24th push it farther from $1000, and it hasn’t been able to muster a significant rally from then. Following doji bars on Friday amd Monday, and a bearish MACD crossover on Friday,today we see gold testing a 50 percent retracment of its rally from mid-January at 905.70. Failure to hold $905.70 could have it testing the 50 day MA at 895.50 (the green line on the chart).Looking back, you can see that the rally that started on January 15 started with a succesful test of the 50 day MA. Momentum indicates a buy day tomorrow, but gold bulls may want to keep their powder dry for the time being.
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