WGC Gold Analysis Report Reveals 11% Decline In Demand
(Gold analysis update, Forex-FX-4x.com) – The third quarter 2012 “Gold Demand Trends” report from the World Gold Council revealed that gold demand was 11% down on the yearly basis, but had increased by 10% on the previous quarter. Demand for gold bars and coins had dropped by 68% and this year-on-year decline resulted from weakness in the sector. In contrast to this poor performance, Gold ETFs experienced strong inflows for Q3 2012.
India was the best performing gold market during Q3 2012, with a yearly basis increase of 12% in investment demand and 7% for gold jewellery. Chinese demand for the precious metal was hit by the well documented slowdown of China’s economy. The WGC report advised that Q45 2012 is likely to see a recovery in Chinese gold demand as economic stimulus measures could be forthcoming from incoming policy makers.
Central banks purchased 97.6 tonnes of the precious metal during Q3 2012 according to the WGC report. Marcus Grubb, the managing director, investment at the World Gold Council advised “Gold is beginning to re-establish itself as part of the fabric of the financial system”.
Gold Technical Analysis – 16th November Forecast/Price Action Overview
- Gold came close to the psychologically important $1,700 per ounce round number area today (15th November) prior to finding a bid and bouncing back up to the recent range lows around the $1715 mark. XAUUSD closed the day -0.82% lower than the open.
- The near term key technical level we have been monitoring over recent reports is based around the prior $1730 area support lows from September/October, which align with the recent 50% retrace of 1795.8 - 1670.97. This area is proving to be relatively robust, holding as resistance so far, but the weekly timeframe bullish engulfing candle is still very much in play.
- The area around $1700 proved to be supportive for gold today but any subsequent downside move would threaten a break of this level. Price action around here should be monitored accordingly.
- Technical traders may be looking for a daily bullish signal to complement the weekly timeframe price action.