Wow, somebody really loves to sell paper gold. Wonder who that may be? I really could care less to tell you the truth, I am grateful to them. I was waiting for the 200 day moving average and then I realized I was falling back into my paper trading ways. I am a physical gold buyer, what is the difference between 1635 and 1614? So, I am the proud owner of some Canadian Maples. I am just about tapped out, but I do have one more credit line waiting for a move to support at 1600. You don’t get a move too often to the 200 day moving average, so I am buying a years worth of gold right now. Sorry paper gold longs, but I really appreciate your efforts to play into the hands of the shorts. You guys are keeping the physical gold flowing, thank you.
In return for your efforts I will give you the following charts. Price closed below the Bollinger band, so if you are short I would be covering right about now. Also price is hovering just above the 200 day moving average, which is pushing you luck if price follows historical trends established in last 10 years. Strong support waits at the 1600 level. Resistance will be former support around 1680, then the 18 day moving average, currently falling through 1712. Longs looking for an entry should snap out of it, you a long way from a low risk entry point.
RSI is as low as it has been since last September and is approaching over-sold. Stochastic is entering over-sold territory as well. I think the intermediate trend channel I have drawn looks good and I expect a bounce back up into the channel and into the Bollinger bands. the short term downtrend remains intact until the swing high at 1760 is taken out. That is unlikely. What is needed is a lower swing high followed by a higher swing low. This will set up a potential entry for the paper long and a new short term uptrend.
RSI on the weekly chart says we have run the course to the downside and reversal should be imminent. Also, the 45 week moving average has not been touched since back in 2009. It currently is at 1599 and climbing. I see the worst case scenario being a kiss of the that average. I will buy there in a big way. Of course all bets are off if this is the collapse of the paper gold market. Then Freegold will be upon us and my physical purchases will reveal the hidden leverage they currently hold.