Richard Perry
Independent Analyst
Gold
The dollar strengthening has really had a negative impact on gold. The price has driven decisively lower in the past few sessions, with key support levels breached. The move is continuing lower today. The rejection of the support around $1902 has been developing but as the US session took hold yesterday another surge of gold selling has pulled the market to what is now a two month low. There was some consideration given to the spike low of $1863 overnight, but the bears continue to drag the market lower today. Having broken decisively clear below the 23.6% Fibonacci retracement (of $1451/$2072) the implication is a move to the 38.2% Fib level at $1835 now. However, if gold is anything like silver then the 50% Fib level may be also on the cards (at $1761). The first real price support is now not until $1789/$1818. We increasingly look to use near term strength as a chance to sell into this continued correction. The hourly chart shows a very near term downtrend around $1870 this morning, whilst the old $1863 support is resistance now.
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