As we see the USD index depreciating to 3 years low against other major currency, it is no surprise that USD pegged commodities saw significant uptrend. Of greater interest is Gold. Earlier in the month when I last posted my analysis when Gold started to forma consolidating wedge with resistance around $1440, there were signs of bearish divergences in RSI, MACD and even STO. When Gold price breakout after $1440, the bearish divergence is immediately seen as a false signal, which is usually so, as it is often used to confirm reversal not vice versa.
One famous Technical Trader termed this as – Hound of the Baskervilles’ Signal. We rarely see the Hound of the Baskerville’s signals because they occur only after an unusually strong signal fails to deliver, giving us a sign that something is fundamentally changing below the surface of the markets. That is the time to reverse the initial position and swing in the direction of the new trend!
Further retest towards resistance turned support @ $1440 further strengthen the continuation of uptrend towards $1500 target based on wedge breakout & Fibonacci projection. At this juncture, Gold price should see some short term consolidation. Near term support towards $1470.
Read other related posts:
- Silver prices tumbled heavily for the first time in months with curb in speculations | Technical Analysis | Commodities Market
- Gold to test recent highs with weakness in USD
- Gold futures, SPDR Gold shares – buy / accumulate on short term price weakness | Technical Analysis | US Commodities
- US Debt Ceiling saga clouded upside potential of markets | Gold & USD Index Technical Analysis | US Stock Markets
- Osama Bin Laden is dead – How will Silver, Gold and Oil prices react? | Financial Review | Stocks & Commodities
- Technical Analysis of Crude Oil, Gold | Commodity Prices | CBOT, CME, NYBOT
- Gold / Light Crude Oil – Further strength amidst uncertainty in Egypt – Commodities
- Quick analysis on STI & Investment Opportunities ahead | Technical Analysis | Singapore Stock Market
- Part 2 : Cyclical sectors as focus during market bottoming – Commodities Stocks | Fundamental Analysis
- USD strengthens against SGD, buy on current retracements | Technical Analysis | Currency Market
- USD Index, USD/SGD staged a recovery | Technical Analysis | Currency Markets
- SGD/USD, with SGD strengthening after MAS monetary policy announcement | Currency Prices | Singapore
- Japan Yen strengthens post Japan earthquake, tsunami & nuclear plant meltdown | Forex | Japan
- Stock Markets Analysis (Dow Jones Index, Straits Times Index, Oil, USD/SGD) | Investment Review | Singapore
- Golden Agri – More weakness – Stock Price / Stock Investment – Singapore Stock Market
Follow us on: 
Share this article on: 
