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Gold Fails To Build On Breakout Of The Downtrend

ByGoldTradingExperts.com
Published 08/13/2014, 04:25 AM
Updated 07/09/2023, 06:31 AM

Following Friday's surge higher on geopolitical woes, gold has failed to build on the breakout of the down trend channel and yesterday made a "lower high" at $1318. The metal saw another "shooting star" candlestick form on the daily chart to suggest the bulls are having trouble maintaining the upward momentum.

The trading is quiet and directionelss, typical of this time of year which is often dubbed the "summer doldrums" due to the lack of trading volume and narrow ranges.

Equities remain well off all time highs and traders will be watching closely for signs of a more significant top developing, however the dollar remains well supported and is trading clear of 81.50 after a strong rally.

Support can be found at $1302-$1306, $1295-$1297, $1286, $1280, $1274, $1263, $1257-$1260, $1250-$1252, $1237-$1240, $1220-$1225, $1210, $1200 and $1180. A break of $1180 would have serious bearish implications for gold and suggest a decline to $1000-$1050 in the short term - a failure to break the 65 week MA would make this scenario much more likely.

Resistance can be found at $1310-$1312, $1322-$1325, $1333-$1335, $1340-$1342, $1352-$1354, $1392-$1395, $1400, $1420 and $1435. A second failure to break through the key 65 week MA would suggest that the intermediate down trend is intact and a retest of $1240 and possibly $1180 is likely.

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