Commodities | Mar 21 2013
A lot has occurred with regard to sentiment towards gold over the last week. Inflation data from the US have been helpful towards our bullish call. Inflation, we suggest, is on the pick up as cheap money continues to flood the market. Inflation in the US and China is close to reaching the targeted band imposed by these countries Central Banks as such it will be interesting to see the reaction once it hits. Which we think will be sooner rather than later.
As at last week's Bulletin we looked for a test of US1600 and this has ben realized. The daily close above this level sets it in motion further gains
We were token long in the market at US1568 and our new position at US1593 looks good.
If the price of gold has moved too far to establish longs then silver may be an alternative. It is interesting to see that silver has failed to move on with gold so it needs to play catch up. A break above US29.30 potentially opens the way for further gains.
Chart Point – Gold:
Technically, the picture for gold remains positive. As we have bounced off the low at US1550, held US1600 and the potential for a test to the topside US1640 is well on the cards. Momentum indicators remain supportive the metal. Any stop can be placed below US1550. It is a little away from the market at the moment however this is the safest place.
Chart Point – Silver:
As can be seen from below silver has not moved. Look for a break above US29.20.
Edited by Jonathan Barratt, Barratt's Bulletin is a weekly subscription newsletter that provides expert analysis of commodity markets, global indices and foreign exchange movements. Click here to take a no obligation 21-day trial to Barratt's or to learn more visit www.barrattsbulletin.com. Content included in this article is not by association necessarily the view of FNArena (see our disclaimer).
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