Technicals | Sep 13 2010
By Rudi Filapek-Vandyck
The TechWizard has observed gold seems to have genuine problems in surging past US$1260-70/oz, despite many a market commentator calling for much higher prices before year-end.
From a technical perspective, reports the Wizard, the case of gold is plain and simple: either the price of gold crosses above technical resistance (US$1260-70) or it doesn't. If it doesn't, then gold will have carved out a double-top formation on price charts and this will act as a major negative, he says.
The Wizard believes the coming weeks will be very important for gold. In case of a double top, he predicts gold will fall back towards US$1160/oz.
A break above resistance would only be regarded genuine if and when gold manages to close above USS1270 on a weekly closing basis, he adds.
The TechWizard is the pseudonym of Scott Morrison, whose experience in financial markets exceeds twenty years. Morrison operates his own website nowadays at www.techwizard.com.au The views expressed are his, not FNArena's (see our disclaimer).