Technicals | Jun 03 2010
“Turning then to gold,” said respected gold trader Dennis Gartman in his newsletter yesterday, “we remain bullish of gold as we have been for months, and we remain bullish of it in euro and Sterling terms but we find ourselves turning bullish too in terms of the yen. If the yen/dollar does move upward through 91.50 today and hold then our propensity to add to the long gold positions we presently hold in euro and Sterling terms by buying gold in yen terms shall be high and rising.”
The US dollar closed over 92.00 this morning.
US dollar gold closed at US$1224/oz last night but having pushed its way back up toward previous highs in recent sessions it has since been meeting with resistance. However gold has decoupled from the US dollar this past month as both the dollar index and spot gold have moved higher. Gold strength is being provided by weakness in other major currencies, and specifically the euro. Hence Gartman's propensity to buy gold in currencies other than the dollar.
Barclays Capital technical analysts note also that US$1229-31 is a resistance area with support remaining at previous “congestion”, being US$1200.
In contrast, says Barclays, gold priced in euros “looks poised to resume its larger bull trend”. The range trade of the past month should resolve itself to the upside. A break of E1013/oz will confirm, clearing the way to the top of the channel at E1059/oz.
In the bigger picture, Barclays suggests the secular bull trend remains place for a run to E1480-1500.
Gold closed at E996/oz last night.
