Gold records new high $2,714 – Bulls eyeing $2,740 and $2,780 while bears wait for correction

Gold reaches new record high $2714.
Interest rate cut by FED and ECB triggers demand for Gold.
Retracement to $2695-$2675 will attract buyers.
Bulls hopeful of further rally to $2740-$2780.

Sunil Kumar Dixit SK Charting

As key interest rate cut of 50 BPS by Federal Reserve was followed by 25 BPS rete cut by ECB, demand for Gold surged as smart money flow switched preferences towards the yellow metal from bonds in anticipation of further bullish rally to continue advancing towards $2740 and even $2780 in near term.

During asian session Gold advanced to $2714 new record high and markets witnessed sideways consolidation between $2702-$2714 refusing to budge below the psychological mark $2700

Any pullback below $2700 will see a retracement to $2695-$2685-$2675 is seen as a possibility where buyers may resurface as immediate trend remains extremely bullish.

All the same, any market that clings to all time high for a fairly long time also has risks of a sharp, sudden and deep correction and Gold is hardly an exception to this vulnerability which urges caution on heights.

Those who trade on the long side, should monitor price action on 5 Day EMA on closing basis which is considered as bearer of the prevailing trend as well as the first line of defense.

Author

Sunil Kumar Dixit

SK Charting

Sunil Kumar Dixit is Chief Technical Strategist and founder of SK Charting, a research firm based in India. He tracks Precious Metals, Energy, Indices and Currency Pairs. He also participates as an expert panellist on Channel Television, Nigeria.

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