Technical Analysis – Gold Daily: fresh 5-month lows could lead to retest of 1180
December 9, 2013 11:04 am
(click to enlarge)
Having traded through technical support around 1250 dollars an ounce 2 ½ weeks ago, gold remains in a downtrend and is looking to test the 1180 level, which is the 3-year low (since August 2010).
The bearish downtrend for gold will remain in place until the 1360 level is breached. An intermediate level of resistance is the 1250 area – a previous level of support which has now probably turned into resistance.
The simple 200-day moving average is quite far away from current price action at 1372, indicating both how strong the selling of gold has been but also that the drop has been an extended one.
The 21-day shorter-term exponential average is also higher at around the 1252 level – the area which could act as intermediate resistance. Gold has been trading under the 21-day EMA for more than a month.
The 14-day Relative Strength Index is at 38, which is bearish territory.
Overall it looks like gold is in a downtrend, that the 1180 level is a reasonable target in the medium-term and given the negative longer-term picture, gold should be sold on any rebound.
(click to enlarge)
Having traded through technical support around 1250 dollars an ounce 2 ½ weeks ago, gold remains in a downtrend and is looking to test the 1180 level, which is the 3-year low (since August 2010).
The bearish downtrend for gold will remain in place until the 1360 level is breached. An intermediate level of resistance is the 1250 area – a previous level of support which has now probably turned into resistance.
The simple 200-day moving average is quite far away from current price action at 1372, indicating both how strong the selling of gold has been but also that the drop has been an extended one.
The 21-day shorter-term exponential average is also higher at around the 1252 level – the area which could act as intermediate resistance. Gold has been trading under the 21-day EMA for more than a month.
The 14-day Relative Strength Index is at 38, which is bearish territory.
Overall it looks like gold is in a downtrend, that the 1180 level is a reasonable target in the medium-term and given the negative longer-term picture, gold should be sold on any rebound.
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