Daily Technical analysis:
GOLD market has tested SMA5 and SMA15 yesterday. Gold market’s SMAs are now contracting and moving in mix direction. While market is moving slightly below all three SMAs.
RSI is showing decreasing bullish strength with 64% reading and moving in downward direction below resistance level (70%).
Upper Band is moving straight, while middle and lower bands are moving in upward direction with squeezing bands, showing decreasing bullish volatility.
With Lutfi Magnet Theory market is 75% Bearish and with adjustments 62% Bearish. Lutfi Magnet Theory and Adjustments are showing bearish sentiment in Gold market.
Concluding all Technical Analysis, initial bias is bullish with downside for a corrective move to support1 at 1746.37 and break there may extend downward move to test middle band at 1740.21. While on upside side it may attempt high at 1757.04, break there my turn bullish biasness to weekly magnet at 1762.18 and then to high at resistance1 1769.40.
Gold prices rose in Asian trading on Thursday, regaining composure after falling earlier when weak U.S. housing data sparked a rally for gold’s traditional hedge, the dollar.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery were up 0.20% at USD1,757.15 a troy ounce, up from a session low of USD1,755.35 and down from a high of USD1,757.55 a troy ounce. Gold futures were likely to test support at USD1,739.35 a troy ounce, Wednesday’s low, and resistance at USD1,757.55, the earlier high. Gold fell earlier after worse-than-expected housing data out of the U.S. spooked investors and sparked demand for the dollar.
In the U.S. earlier, the Commerce Department reported that new home sales fell to a seasonally adjusted annual rate of 373,000 in August from 374,000 in July, whose figure was revised up from 372,000. Analysts had expected new home sales to rise to 380,000 in August. The news sent investors selling gold and running to dollar, the asset class of choice for many amid times of uncertainty thanks to its liquidity.
Meanwhile in Europe, protests broke out in the streets of Madrid on Wednesday before the Spanish government’s plans to unveil new austerity measures to accompany the country’s 2013 budget later Thursday. Yields on Spain’s benchmark 10-year government bond topped 6 percent earlier on concerns the country will run into problems financing it. Spain has yet to request a bailout, though the country has said it will meet its budgetary goals. Uncertainty over Greece’s fate sparked the risk-off trading session earlier as well.
Gold, however rebounded, especially as a reminder that central banks continue to stimulate their economies with monetary easing measures, which weaken paper currencies to boost growth rates.
Gold opened the day at 1760.60 with a bearish move. It attempted high at 1765.53 and moved downward to low at 1736.18. Gold market closed the day at 1752.31
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