Sep
6
2010

 

Gold Hangs Around $1250/oz

Gold is hanging around its highly psychological $1250/oz level in a quiet trading session as Americans celebrate the Labor Day Holiday.  However, markets should come alive tomorrow with monetary policy decisions from both the RBA and BOJ on deck.  Although the BOJ is not expected to intervene in the currency markets at this point, should the central bank actually take action then this would likely benefit gold since looser liquidity normally leads investors towards gold as a hedge against inflation.  Speaking of inflation, investors should keep an eye on activity in softs since markets have experienced huge rallies in agricultural commodities, particularly wheat.  If the rally in ags spreads to oil inflation chatter could increase and boost gold in succession.  Either way, gold’s long-term uptrend is clearly intact with a multitude of uptrend lines in play.  The question know becomes whether gold can gain enough topside momentum to leave behind $1250/oz and tackle previous 2010 highs.              
            
Technically speaking, gold has supports in the form of 9/3 and 8/31 lows.  As for the topside, gold faces technical barriers in the form of previous September highs and the psychological $1250/oz level.  Additionally, previous 2010 highs could serve as a solid technical barrier should they be reached. 
Present Price: $1249.05/ oz
Resistances: $1250.91/oz, $1252.71/oz, $1254.71/oz, $1255.70/oz, $1258.05/oz
Supports:  $1248.34/oz, $1246.71/oz, $1244.97/oz, $1241.60/oz, $1240.12/oz, $1238.62/oz
Psychological: $1250/oz, 2010 Highs
 
 
 

 
Posted by: Matthew Myers

 

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