Gold Move
October 7th, 2009Warning: This is not a recommendation to buy, sell or hold any financial instrument.
I have to conclude that the immediate term direction on gold is up. It’s setting up an ascending triangle on the hourly interval and it has overlapping supports (daily) just below. Even if the hourly ascending triangle fails, a retracement to around $1028 could be considered part of a healthy pullback.
Spot gold, hourly interval
While gold looks set to make new highs, short term, this breakout is occurring without the U.S. Dollar Index breaking down and out of its range. That should concern gold longs here. 75.912 on the U.S. Dollar Index must be taken out to the downside, or gold is going to correct.
U.S. Dollar Index, daily interval
If you have large profits on a speculative gold position (and I know that many Cryptogon readers do), I would consider taking profit on a portion of your holdings, or buying protective puts; especially on the next push higher—if it happens—over the next several hours to days. A more important tripwire for gold longs to watch is the 77.475 level on the U.S. Dollar Index.
What is up with the Euro and GBP, last time I looked the Euro was at abuot 692 yesterday for gold and Pound at 622 now they are at 711 and 658. This cannot be just because of the Aussie rate increase can it? This is not just technical action.
I was watching the gold chart and I started thinking, “Is there some kind of geopolitical thing in the works? Did something blow up?”
Nope.
Not yet, anyway.