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Gold ends higher after 3-day fall

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 13, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Córdoba) - Gold prices started the day with a negative tone, with spot falling down to 1,079.75 before suddenly changing course in the American afternoon, advancing over $15.00 per ounce as oil and stocks plummeted.

    The dollar wavered as the early market's confidence faded, whilst a three digit decline in the DJIA sent investors running towards safety. The precious metal also got help from central banks, which added 55 tons of gold to their reserves in November, according to the World Gold Council, with the biggest buyers being China and Russia.

    The metal reached a peak above $1,095 an ounce during the New York session before settling 0.2% up at $1,087.10 an ounce, posting its first gain in four days.

    Gold technical view

    “Currently trading around $1,092.40, the daily chart shows that the price has bounced sharply from a bullish 20 SMA and the 61.8% retracement of its latest bullish run, a major support area, while the technical indicators are bouncing from around their mid-lines and maintaining their bullish slopes, in line with further gains ahead”, said Valeria Bednarik, chief analyst at FXStreet. “Shorter term the 4 hours chart shows that the technical indicators have bounced from near oversold levels and head north around their mid-lines, while the price advanced above the 38.2% retracement of the same rally, now the immediate support around 1,092.00, but remains capped by a bearish 20 SMA”.

    Support levels: 1,092.00 1,083.40 1,078.90. Resistance levels: 1,097.65 1,113.05 1,122.40.
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