Comex gold futures ruled steady on Thursday as a retreat in the dollar from 12-year highs arrested an eight-session slide. But expectations that US interest rates will rise sooner rather than later kept prices under pressure.

Investors have been pulling out of bullion, given the bullish outlook for the dollar. SPDR Gold Trust, the world’s top gold-backed exchange-traded fund, saw its holdings drop to the lowest in over a month this week.

Comex gold futures are languishing near the psychological $1,200/oz levels.

As mentioned earlier, though, the short-term technical picture is still supportive around $1,200 levels; the overall picture is one of weakness. Also, failure to hold here around $1,167-70 could reaffirm the big picture bearish view for gold. Prices dropped lower in line with our expectations. Prices have also hit a potential target close to $1,145 levels. A mild pullback is noticed now, which can take prices higher towards $1,175-80 levels where resistance will be strong.

For the coming week, expect upticks to get capped in the $1,175-85 range and decline lower towards $1,145 levels or even lower to $1,110, where it could take some intermediate support. Only a close above $1,203 could revive bullish hopes again.

Such a move could take prices higher towards $1,245 levels again or even higher. The wave counts need to be altered as prices move, but the overall trend looks weak and at present levels makes it difficult to take any directional call decisively.

So, for now, we will stick to our previous assessment. It is most likely that the fall from the all-time highs at $1,925 to the recent low of $1,130 was either a corrective wave “A” and a wave “B” is in progress with targets near $1,435 or even higher.

It is also possible that the entire corrective A-B-C got over and a new impulse is in progress targeting $1,527-30 or even higher in the medium-term. If prices do cross -over above $1,435, then we can settle for the latter.

RSI is in the oversold zone now indicating that a possible upward correction is in the offing. The averages in MACD are below the zero line of the indicator, indicating bearishness again. Only a cross over again above the zero line could hint at a bullish reversal.

Therefore, sell Comex gold on upticks to $1,177-80 with a stop-loss at $1,202 targeting $1,145 initially followed by $1,110. Supports are at $1,195, 1,168 and 1,155. Resistances are at $1,215, 1,228 and 1,245.

The writer is the Director of Commtrendz Research. There is risk of loss in trading.

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