Gnanasekaar T

Gold to test support, zoom

Gnanasekaar T. | Updated on March 12, 2018 Published on June 19, 2011

Comex Gold chart as of 170611.jpg



Comex gold ended higher on Friday, as a dollar dropped amid an outline agreement to aid debt-burden Greece boosted risk appetite. Gold accelerated gains after mixed U.S. data point to a wobbly economic recovery. U.S. consumer sentiment worsened more than forecast in June on continued economic pessimism. Gold market participants also focused on development over talks to reach a deficit-cutting agreement among U.S. lawmakers also underpinned gold. The end of a $600-billion U.S. government bond-buying programme, or the second round of quantitative easing dubbed as QE2, this month is also fuelling economic worries.

Comex gold futures are moving in line with our expectations. As mentioned in the previous update, the focus was back on $1510-15 levels again, where support is quite strong. This also happens to be a trend line support point. Near-term support is at $1530-35 levels now. While the support levels hold, we still expect prices to reach for potential trend channel resistance at $1605-10. Structures are turning positive again. Break above $1555 will open the way now for a push higher towards $1575 initially followed by $1605-10 a potential target. However, failure to close above $1,555 could lead to another round of consolidation between $1510-1555.

Our wave counts are now hinting at a final fifth wave to have begun. As we have been maintaining there is a possibility of the fifth wave to continue rising higher above $1577 towards $1600 levels. Therefore, we have modified our previous wave counts of a possible wave “A” which ended at $1505. We will review these counts again if we see a sharp decline again. RSI is the neutral zone now indicating that it is neither overbought nor oversold. The averages in MACD are still above the zero line of the indicator, indicating bullishness to be intact.

Therefore, look for gold futures to test the support levels and rise again.

Supports are at $1,535, $1,510 and $1,465. Resistances are at $1,555, $1,577 and $1,595.



(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.)

Published on June 19, 2011

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Sincerely,

Support Quality Journalism
null
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.