Gold Rush is Back?

Iraq is now a hottest topic to be spoken in Financial Market. Every country now fear the oil risk which will affect the CAD and boost us inflation. It is always seen that when inflation rise, it also boost gold price as most of the investor think gold to be the safe heaven in a economic crisis thus having a positive correlation between crude oil price and gold price

Every nation is looking at the worst case senior of Iraq. As there is no help/aid form Uncle Sam nor any dominant countries interested to involve in the war, thus making Iraq indulge alone on its own.  Britain is proactive rising interest rate suspecting the oil risk and inflation. For any country the worst case scenario can be a rise in underling crude oil price up-to 10-20%. And this can be seen for next 3-6 months.   

Technical Analysis on Gold

Compared to silver, gold haven not shown any bullish indication as such; except an doji formed on last trading day. The previous pattern seen in gold was a descending triangle pattern and thus gave a indication that the gold rush so called is going to end. but the Iraq was gave a new twist and turn in the price pattern. As per now there is high chance that the gold can make a turn around and stay above 28K. Still 31K is a good resistance. This Iraq crisis will have a short term implication on crude as well as old. Few Indian Jewelry are in a bad condition and this rise in gold price will also affect them. 

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Strategy for Gold on FOCM meeting

Today all eyes are on FOCM meet to be held. Not only commodity and Gold but Forex and stock market will have implication of the meeting which is to be held today or tomorrow(Source: Business Standards). Anticipating strategies for gold, all eyes are on tapering of bonds by fed. Many experts believe that Fed will come up with taping of bond buying program. If it happens gold will loose value globally.

Technical

An open up candle followed by a bearish engulfing had given a clear indication of a possible bearish trend 28k &26K are the good supports as seen in technical charts. More clarity will be seen after fed's bond buying strategy.  

Gold what's next??

I never expected gold above 32,500. Since June-July I am giving regular updates on my blog on a special request. After formation of a  expanding triangle, gold had reached 34,500 testing a new height. After a breakout of 32,500. The sustainability was not seen , after a negative reversal gold reached its climax; starting a correction.

Know we have a question where do gold find its support. Currently we have 2 major supports and 2 trend-lines. But 30,000(50%; fib) is found to be next level, if it fail. We can see gold 27,800-28,000 as a powerful support.

 Fibonacci levels

Major SAR

Gold can be a good investment if we witness any reversal at 30,000 levels. We may see gold again touching 34,500/ testing new heights.

To read previous article on Gold: Click here

Gold; Where is it?

Gold has become a huge political issue. In spite of many artificial measures to stop import of gold, government has miserably failed. This eventually led to the domino effect in the entire Indian Financial Markets.

We are currently seeing Gold at upper level the RSI is giving a caution signal and we have 2 major resistances ahead. It’s a high time for gold, the trend-line which was broken by gold during the end of March and the upper level resistance @32,500.

We are seeing signals from gold of a possible correction. Which will start from the first week of next month or prior. 

If gold is able to give a breakout and sustain the breakout gold is again a screaming buy.

For previous article on gold; Click Here