Gold for Wednesday, January 28, 2015
Gold has enjoyed a very solid last few weeks as it has surged to a five month high near $1308, before easing back a little in the last several days. To start last week it had just eased back a little and steadied below the $1280 level after surging to that area and a four month high recently. It is now consolidating in a narrow range between $1290 and $1295. In the last few weeks it has been able to rally strongly from around $1170 back through the key $1200 level and to a 12 week high just above the $1240 level before its further surge higher in the last couple of weeks. Despite this recent break, the $1240 level remains key as it has provided plenty of resistance over the last few months and is now likely to play a role should gold retreat back to it.
At the beginning of last month gold eased lower away from the resistance level at $1240 yet again back down to below $1200. During the second half of November gold made repeated runs at the resistance level at $1200 failing every time, before finally breaking through strongly. Throughout the first half of November Gold enjoyed a strong resurgence back to the key $1200 level where it has met stiff resistance up until recently. 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 spent a few days consolidating around $1160 after the strong fall which has allowed it to rally higher in the last couple of weeks.
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. 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.
Gold edged up on Tuesday after two sessions of losses, as the dollar and shares eased ahead of a U.S. Federal Reserve policy meeting that may push back expectations for when U.S. interest rates will start to rise. The Fed starts its first two-day policy meeting of the year later on Tuesday and investors expect it to acknowledge the uncertain global outlook and stick to its promise to be patient on tightening. Spot gold was up 0.5 percent at $1,287.30 an ounce. The metal had fallen 1.6 percent in the previous two sessions on strong equities and uncertainties over the Greek election. Gold hit a five-month high of $1,306.20 on Thursday.”The bullion market’s focus may shift to the upcoming FOMC two-day meeting on 27-28 January,” said James Steel, an analyst with HSBC, referring to the U.S. Federal Reserve’s Federal Open Market Committee. “In the near term, bullion may continue to consolidate from gains made earlier in the year,” Steel said. Investors will be watching the Fed meeting for clues about the timing of any interest rate increase.
Gold January 27 at 22:35 GMT 1292.6 H: 1297.7 L: 1272.3
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1240 | 1200 | 1170 | 1300 | — | — |
During the early hours of the Asian trading session on Wednesday, Gold is trading in a narrow range between $1290 and $1295 after easing back from the five month high near $1308. Current range: trading right above $1290 around $1292.
Further levels in both directions:
• Below: 1240, 1200 and 1170.
• Above: 1300.
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 moved back well above 50% as it has eased back away from the five month high near $1300 in the last few days. The trader sentiment is ever so slightly in favour of long positions.
Economic Releases
- 20:00 (Tue) NZ RBNZ – Cash Rate
- 21:45 (Tue) NZ Trade Balance (Dec)
- 23:50 (Tue) JP Large Retailer Sales (Dec)
- 23:50 (Tue) JP Retail Sales (Dec)
- 00:00 AU Skilled Vacancies (Dec)
- 00:30 AU CPI (Q4)
- UK Nationwide House Prices (28th-2nd) (Jan)