GOLD SETTLE $ 1625.10 (Dec) HIGHER $ 2.40
Gold did nothing and show a sideways trend through out the entire
trading day on the very first day of week. The most of traders waiting for
an annoucement of 02 days FOMC meet held this week.
After Ben Bernanke testified in front of Congress on July 17th,
economists began speculating that the FED may have to once again rescue the
market with supportive economic policy. Speculation grew into expectation
following the remarks made in Europe last Friday, but it is still unknown what
the FED has left to bring to the table. One idea that has been talked about the
most revolves around the FED cutting interest rates that is paid on bank
reserves, which will bring down short term borrowing costs and in turn
stimulate lending. The FED could also extend lowered interest rates until late
2014 or possibly even step back into the bond market with another round of
Quantitative Easing
While QE is highly unlikely, I believe that any supportive
statements made this week from Europe or the United States would help Gold
Futures rally. Gold prices made a convincing move
out of the narrowing range and even tested the high prices from early July. I
mentioned last week that a breakout would likely have two targets, first $1600
and then $1620. Now that both targets were met, we will likely hold the range
between these two prices until final announcements are made in the US on
Wednesday, followed by an ECB press conference on Thursday . If there is follow
through buying above $1620, the next targets should be June's high price near
$1640, then the 200 day moving average closer to $1660. Conversely, if last
week's remarks are not backed with anything concrete, then last week's
rally will be lost in a flood of selling in the Gold. The lower end of the
range would be priced around $1560.
RECOMMENDATION OF THE WEEK : THE TRENDLINE FOR DEC GOLD FUTURE $ 1615-17, IF HOLD BY JULY CLOSING.........WE WILL BUY GOLD FOR TGT $ 1645 $ 1663 WITH A SL $ 1598
Happy Trading
Rahul Kumar
Gold Specialist (Spot & Future)
Call me : 895-8173-410
Gold did nothing and show a sideways trend through out the entire
trading day on the very first day of week. The most of traders waiting for
an annoucement of 02 days FOMC meet held this week.
After Ben Bernanke testified in front of Congress on July 17th,
economists began speculating that the FED may have to once again rescue the
market with supportive economic policy. Speculation grew into expectation
following the remarks made in Europe last Friday, but it is still unknown what
the FED has left to bring to the table. One idea that has been talked about the
most revolves around the FED cutting interest rates that is paid on bank
reserves, which will bring down short term borrowing costs and in turn
stimulate lending. The FED could also extend lowered interest rates until late
2014 or possibly even step back into the bond market with another round of
Quantitative Easing
While QE is highly unlikely, I believe that any supportive
statements made this week from Europe or the United States would help Gold
Futures rally. Gold prices made a convincing move
out of the narrowing range and even tested the high prices from early July. I
mentioned last week that a breakout would likely have two targets, first $1600
and then $1620. Now that both targets were met, we will likely hold the range
between these two prices until final announcements are made in the US on
Wednesday, followed by an ECB press conference on Thursday . If there is follow
through buying above $1620, the next targets should be June's high price near
$1640, then the 200 day moving average closer to $1660. Conversely, if last
week's remarks are not backed with anything concrete, then last week's
rally will be lost in a flood of selling in the Gold. The lower end of the
range would be priced around $1560.
RECOMMENDATION OF THE WEEK : THE TRENDLINE FOR DEC GOLD FUTURE $ 1615-17, IF HOLD BY JULY CLOSING.........WE WILL BUY GOLD FOR TGT $ 1645 $ 1663 WITH A SL $ 1598
Happy Trading
Rahul Kumar
Gold Specialist (Spot & Future)
Call me : 895-8173-410
