• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy
• Books

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Gold futures ended marginally lower on Friday due to a strengthening dollar. However, firm physical demand and geopolitical tensions are expected to underpin gold futures. The other main external influence on gold was crude oil, which reversed initial losses to turn four per cent higher on rising tensions in the West Asia and a dispute between Russia and Ukraine over natural gas supplies. The outlook for 2009 looks quite positive for gold on the back of the global turmoil and inflationary expectations due to the current monetary easing that could lead to funds chasing commodities again.

Comex December gold futures are gradually edging higher. No change in view. As mentioned earlier, very important support is at $845 now, and as long as this level remains undisturbed, there are good chances of this bullishness to remain and prices to rise towards $920-25 levels in the coming sessions. Ideally, we expect a test of $1,055 or even higher as long as the important supports hold. Unexpected fall below $842 could trigger weakness and such a fall could take prices lower again towards $810-15 levels. We believe that the third wave could have ended at $1,033 and the fourth wave that we have been tracking could still be in formation and in the process of a beginning of a new fifth wave impulse. The RSI is in the neutral zone, indicating that it is neither overbought nor oversold. The averages in MACD are above the zero line of the indicator again, suggesting a possible bullish reversal. Only a cross-over below the zero line of the indicator could signal bearishness. Therefore, expect gold futures to correct lower initially and then rise higher again. Supports are at $867, 854 & 842. Resistances are at $886, 892 & 917.

Gnanasekar T.

(The author is the Director of Commtrendz Research and also in the advisory panel of Multi Commodity Exchange of India Ltd(MCX). The views expressed in this column are his own and not that of MCX. This analysis is based on the historical price movements and there is risk of loss in trading. He can be reached at gnanasekar_thiagarajan@yahoo.com.)

More Stories on : Gold & Silver | Technical Analysis

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2009, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line