The Hindu Business Line : Gold looks bullish still

Gold futures ended higher on Friday helped by a fall in the dollar against the major currencies. Investor sentiment has improved with a growing sense of calm and confidence returning to global financial markets, reflected by gains in the stock markets and falling bond prices.

A rally in crude oil also extended support to gold futures coupled with pre-season physical buying lifting prices higher. However, credit worries could still hurt gold and the threat of central bank sales still looms large.

Comex December gold futures pulled back quite smartly higher. Only a move above $687 will rekindle bullish hopes.

In any case the $688-93 zone could still pose significant resistance for a fall lower again.

However, supports in the $650 zone have been holding pretty well. We now see this range set for the market in the near-term. A break on either side of this range should provide a clear direction.

Our favoured view now expects resistance in the $688-93 zone to cap for a fall lower again. We believe that the third wave could have ended at $732 and the current move being a fourth wave consolidation and the beginning of a fifth wave impulse will be confirmed above $698. RSI is in the neutral zone indicating that it is neither overbought nor oversold.

The averages in MACD are still above the zero line of the indicator suggesting bullishness to be intact. Only a cross-over below the zero line will be a clear bearish sign. Therefore, expect gold futures to test the resistance levels and correct lower.

Supports are at $672, 667 and 658. Resistances are at $683, 688 and 693.

Gnanasekar.T

More Stories on : Technical Analysis | Gold & Silver

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

Stories in this Section
Aluminium futures may continue to dip

Rains splatter around despite weak monsoon

Good demand for orthodox, CTCs in Kolkata sale

Darmona tea posts new record at Coonoor auctions

Kanan Devan to pay 10%

Weak trend at Kochi tea auction

Cotton may bounce higher

Gold looks bullish still

Tobacco industry told to ensure stable market

Pepper market down on bearish activities

Guar gum exports to Europe come to a standstill