Gold Technical Analysis – March 1st 2013 – Outlook
- The price of gold has just experienced the worst monthly basis decline since May 2012. The XAUUSD instrument has dropped for a third consecutive day during trading in London on March 1st, already covering 110% of the average daily range over 60-days at 10:56 GMT.
- The strengthening US dollar has weighed on the price of gold, with the US dollar index trading near the 82.00 area recent range highs – the 61.8% Fibonacci retrace of the last leg lower.
- Strong U.S. economic data has also seen the so called “safe haven flows” into gold minimised. However, Joni Teves, an analyst at UBS AG in London, has noted that. “A dovish Fed Chairman Bernanke and U.S. sequestration kicking off suggest that investors ought to keep an eye out for buying opportunities”.
- The yellow metal had pared back some of the recent losses until the selling resumed on the 26/2/13 - as price approached the previous support level which subsequently provided resistance.
- In the near term, the recent range low is located around 1554.92 and is viewed as a key technical area of interest.