'Gold's technicals reflect powerful, sustained and accelerating rally'
Gold | 2012-09-13 08:26:35
Sideways action in gold over the summer has since morphed into a "rather powerful, sustained and accelerating rally" in the last few weeks, said TD Securities in a technical-chart analysis of the precious metals.
By Paul Ploumis
NEW YORK (Scrap Monster): Sideways action in gold over the summer has since morphed into a "rather powerful, sustained and accelerating rally" in the last few weeks, said TD Securities in a technical-chart analysis of the precious metals.
Spot gold has hit its highest levels since March and has a firm underpinning based on moving averages, trading well through the 200-day and 40-week averages, and oscillators.
They continued that, “the bullish situation is evident on shorter- and longer-term charts. Such situations usually suggest a deeply entrenched trend which allow for only shallow and short-lived corrections."
"These corrections usually provide good opportunities to establish or add to positions. From here, we look for strong support on dips to the $1,680/85 area with the 200-day MA ($1,641.80) set to remain key pivotal support for the broader trend overall." TDS noted.
"Having broken through the top of the wedge signal at $1,644.70 and the base (resistance) of the old, long-term bull channel ($1,710.30), the healthy undertone of the market suggests a near-term test of the low $1,800s," they concluded.
