Gold for Thursday, November 20, 2014
In the last few hours Gold has been easing back towards $1180 after making a couple of runs at the resistance level at $1200 and failing. In the last week or so Gold has enjoyed a strong resurgence back to the key $1200 level where it has met stiff resistance. Throughout the second half of October gold fell very strongly and resumed the medium term down trend falling from above $1250 back down through the key $1240 level, down below $1200 to a multi year low near $1130. It spend a few days consolidating around $1160 after the strong fall which has allowed it to rally higher in the last week. Earlier in October Gold ran into the previous key level at $1240, however it also managed to surge higher to a five week high at $1255.
As to be expected, the key $1200 level is likely to play a role and provide reasonable resistance. In late August Gold enjoyed a resurgence as it moved strongly higher off the support level at $1275, however it then ran into resistance at $1290. In the week prior, Gold had been falling lower back towards the medium term support level at $1290 however to finish out last week it fell sharply down to the previous key level at $1275. During the second half of June, gold steadily moved higher but showed numerous incidents of indecision with its multiple doji candlestick patterns on the daily chart, around $1320 and $1330. The OANDA long position ratio for Gold has eased back to 60% as gold has surged higher back to $1200.
At the beginning of June, gold did very well to repair some damage and return to the key $1275 level, then it has continued the momentum pushing a higher to its recent four month high. After moving so little for an extended period, gold dropped sharply back in May from above the well established support level at $1275 as it completely shattered this level falling to a four month low around $1240. It remained around support at $1240 for several days before its strong rally higher. It pushed down towards $1280 before sling shotting back and also had an excursion above $1300 for a short period before moving quickly back to the $1293 area again.
Gold prices whipsawed after policy-makers decided to keep its wording on the timing of any interest rate hikes out of concern that a change could be misinterpreted by financial markets. Spot gold was last down 0.6 percent at $1,191 an ounce, after hitting a high of $1,202.30 earlier. U.S. gold futures for December delivery settled $3.20 lower at $1,193.90 an ounce. Minutes of the Fed’s Oct. 28-29 meeting show that Fed officials renewed a debate from their September meeting about whether they should alter language they have used since the spring that they expected to keep a key short-term interest rate low for a “considerable time” after halting monthly bond purchases. The Fed did decide at the October meeting that the economy had improved enough to halt the bond purchases but they kept the “considerable time” language because of worries that removing it would be misinterpreted. The Fed’s first rate hike is currently not expected to occur until mid-2105.
Gold November 19 at 22:35 GMT 1182.7 H: 1202.4 L: 1175.1
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1140 | — | — | 1200 | 1255 | — |
During the early hours of the Asian trading session on Thursday, Gold is easing back towards $1180 after making a couple of runs at the resistance level at $1200 and failing. Current range: trading right around $1185.
Further levels in both directions:
• Below: 1140.
• Above: 1200 and 1255.
OANDA’s Open Position Ratios
(Shows the ratio of long vs. short positions held for Gold among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The long position ratio for Gold has eased back towards 60% as gold has eased away from the resistance level at $1200. The trader sentiment is strongly in favour of long positions.
Economic Releases
- 09:00 EU Flash Composite PMI (Nov)
- 09:00 EU Flash Manufacturing PMI (Nov)
- 09:00 EU Flash Services PMI (Nov)
- 09:30 UK Retail Sales (Oct)
- 11:00 UK CBI Industrial Trends (20th-25th) (Nov)
- 13:30 CA Wholesale Sales (Sep)
- 13:30 US CPI (Oct)
- 13:30 US Initial Claims (15/11/2014)
- 14:45 US Flash Manufacturing PMI (Nov)
- 15:00 EU Flash Consumer Sentiment (Nov)
- 15:00 US Existing home sales (Oct)
- 15:00 US Leading Indicator (Oct)
- 15:00 US Philadelphia Fed Survey (Nov)
- JP BoJ Publication of Monthly Report