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June 13th Gold Trend Analysis

In last nights website update — resistance was listed at 1547-1556 and the high so far today is 1532 —- support was listed at 1256-1533 and the low so far in SPOT is 1522.50

TRADES: I was filled on my short order that was listed on the website last night … it was only a 1/2 position — and I have another sell listed and a price listed to take profits. (Check the daily page)

(Be careful — price has not fully broken down — and needs to CLOSE below 1526 to favor lower and follow thru)

CME NEWS

London Gold Fix $1,524.70 -$17.30

At least in the early action today, August gold has forged a fresh new low for the move and in turn managed a trade below the June 2nd action. The action in the dollar markets doesn’t look to be providing the majority of the pressure on gold prices this morning, but it is possible that slackening economic expectations and talk of the prospect of Japanese style stagflation in the US, from key Democratic operative over the weekend might be keeping things at bay. It is also possible that gold is being undermined by slackening views toward commodities in general. At least in the Monday trade, there doesn’t seem to be much angst toward the Euro zone debt situation and that might be another reason why the bears have shown some early control. But things can change on a dime here so remain cautious.

Going to the Charts:

Gold is right on the edge of dropping out of the purple channel line — but has been playing cat and mouse action all morning as price moves down to the 1523-1525 area but price keeps getting held there as the bulls are trying to hold this area. With the WEAKER CYCLES due to end this week — and the stronger trends are due to return— there is significant RISK in short positions at this area if Gold rallies and does not close below 1526 today. So we’ll have to keep an eye on things. Thus price is at the pivot point at 1526 — and it takes a close below 1526 to keep pressure on the downside. In summary — price can still turn higher here and we can make a case for either side. Let’s see how things end up today. The price action is right at the lower purple channel line….and the price battle here between the bulls and bears has each side fighting it out. We want to see a close below 1526 if the trend is to remain lower. REMAIN cautious. The market is unsure which way it wants to resolve. THE LOWER PURPLE CHANNEL LINE is going to be the key.

by Bill Downey

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Thoughts
"For a mountaineer, the important things are the effort, the posture and the muscles. The rope that holds him serves no purpose when everything works but it gives him a sense of security. In the same way, all gold does is ensure confidence; it's a safe haven."