PRICE OF GOLD TO ENCOUNTER RESISTANCES

Gold is moving in a trading range between 880. and 929 (R1 on the chart).

At the moment, the various indicators aren’t very helpful in determining probable price direction for the week.

Here is a reasonable but not guaranteed possibility:
The upward move in the market will encounter some resistance at mathematically calculated levels before reaching resistance at R1. The first level is around 915 and the second at 920. The market may find difficulty closing above this level. If that is the case, strong resistance could send price downward toward support at S1 before the market gathers sufficient bullish energy to break through R1 to create a new high above 927.


Daily Gold chart as at 5 February 2009 using NextVIEW Advisor. Click on chart for larger view.

TECHNICALS

EMA 20 – short term moving average, rising and supporting price.
SMA 100 – longer moving average – flat.
MACD – in positive territory, but weakening.
Stochastic – Dropping from it’s over bought level.
R1 – 929.
S1 – 880.
S2 – 865.

****

Article and Commentary by Don Schellenberg. A trader and trading coach, he is a noted expert on Market Structure, Elliott Wave and Fibonacci. He trades the forex market.