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Gold Technical Analysis WC 10th December

Gold Technical Analysis WC 10th December

Gold Technical Analysis – WC 10th December

  • Gold closed around 0.64% lower on the weekly basis as the precious metal finished trading close to the $1700 area in New York late on Friday. This comes on the back of a week dominated by central bank decisions from around the world including the UK, Australia, Canada and the Eurozone. The downgrade of Eurozone growth projections has seen the EUR/USD trade well below the key 1.3000 handle and the dollar gain accordingly.
  • From a technical analysis perspective, we note that the price of gold broke below the key $1700 per oz level this week with a low of $1683.23 (XAUUSD) hit after an inside day breakout to the downside triggered on Friday. This followed the better-than-anticipated US employment data (non farm payrolls).  The US added 146k jobs in November versus a widely estimated of 85k with the unemployment rate falling to 7.7% from 7.9%.  
  • Price quickly found support just above the previous 1672.54 swing low, from 5/11/12, and has subsequently moved back above $1700 handle as the week drew to a close, thus forming a “bullish outside day” and “inside day false breakout” in the process.
  • A range trading scenario may be seen unless a fresh catalyst is found, especially as we are heading into the year end which is often associated with lower volatility and lower volumes (all else being equal).  
  • In the mid to long term, the price of gold could continue to see supportive price action as long as QE remains a focus and at present there is no end to this in sight.
    Gold has been a major beneficiary of monetary easing measures from leading central banks, including the US Federal Reserve.  However, if the key $1800 area resistance is not broken, sentiment towards the precious metal may once again turn and bring associated selling pressure. 
  • We do however note that the dollar index printed a weekly bullish outside candle price action formation and any extended USDX strength may weigh on the precious metal.
Gold Analysis – XAUUSD D1 Chart

gold technical analysis 10th december Gold Technical Analysis WC 10th December

Gold Technical Analysis Update, Week Of 10th December

One Response to Gold Technical Analysis WC 10th December

  1. gold says:

    The FOMC policy meeting on Wednesday is now a main focus when FED Chair Bernanke releases his updated forecasts around interest rates, growth and inflation.

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