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Golden Support Level?

Site Administrator | October 4, 2011

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Gold futures have had a healthy correction since making life-of-contract highs of 1923 on September 6, 2011. The retracement back to 1535 on September 26th represented approximately a 20% move over the course of fourteen trading days had gold bugs scrambling and gold bears rejoicing. Exchange margin increases as well as renewed fear overseas sparked liquidation as gold was quickly viewed as a risk asset rather than a safe-haven flight to quality investment.

Gold prices appear to be consolidating just above the 50% retracement level of 1550 and above the long-term uptrend line, which is serving as solid support. Conservative traders may want to wait for a retest of the uptrend line before establishing long positions. A trade above the minor resistance of the 1680 area could then target stronger resistance at 1680 and then could eventually retest the contract highs.

 

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The TradingPub

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Risk Disclaimer: Past performance is not indicative of future results. Futures trading involves substantial financial risk. Please consult your personal financial advisor before using this information for your own trading purposes.Gold futures have had a healthy correction since making life-of-contract highs of 1923 on September 6, 2011. The retracement back to 1535 on September 26th represented approximately a 20% move over the course of fourteen trading days had gold bugs scrambling and gold bears rejoicing. Exchange margin increases as well as renewed fear overseas sparked liquidation as gold was quickly viewed as a risk asset rather than a safe-haven flight to quality investment.

Gold prices appear to be consolidating just above the 50% retracement level of 1550 and above the long-term uptrend line, which is serving as solid support. Conservative traders may want to wait for a retest of the uptrend line before establishing long positions. A trade above the minor resistance of the 1680 area could then target stronger resistance at 1680 and then could eventually retest the contract highs.

 

***Be sure to join us for our free educational event on learning to trade with a Day Job by REGISTERING HERE

Cheers,

The TradingPub

“Trade, Talk, Learn – Cheers to Success”

Follow us on Twitter

 

Risk Disclaimer: Past performance is not indicative of future results. Futures trading involves substantial financial risk. Please consult your personal financial advisor before using this information for your own trading purposes.