http://www.telegraph.co.uk/finance/p...below-900.html
'Gold price to fall below $900'
Gold may extend a decline after failing to breach so-called resistance at $977.41 an ounce.
Standard Chartered Bank said that gold could extend its decline, citing trading patterns and forecasting that the metal may drop to less than $900.
The resistance level represents a 76.4pc retracement of the metal’s drop from the near-record high of $1,032 an ounce to the low of $883.90 on March 18, said David Barclay, the bank’s commodity strategist, referring to a number that is part of the Fibonacci sequence.
Spot gold is expected to trade lower over the near term, as a potential top continues to unfold. There is “a sell signal in place for now,” said Barclay. Resistance refers to a level where sell orders may be clustered.
Technical analysis is founded on the belief that past trading patterns can be used to predict future moves. Fibonacci analysis uses a mathematical formula based on the theory that prices may rise or fall by certain percentages after reaching a high or low.
A break of one indicates an asset may move to the next, while a failure suggests a trend may stall. Other Fibonacci points include 61.8pc.
The metal last traded at less than $900 an ounce on March 18, when it dropped to as low as $883.90.
“The one-month view for spot gold continues to favour a breakdown below $900, which should allow for a test of $865 to $860 and lower,” Barclay added.
So-called daily momentum indicators, such as the 14-day relative strength index and the stochastic oscillator, are “mostly bearish, and upticks are still favoured to sell into”, Barclay wrote. The 14-day relative strength index is 54.52 and falling, according
'Gold price to fall below $900'
Gold may extend a decline after failing to breach so-called resistance at $977.41 an ounce.
Standard Chartered Bank said that gold could extend its decline, citing trading patterns and forecasting that the metal may drop to less than $900.
The resistance level represents a 76.4pc retracement of the metal’s drop from the near-record high of $1,032 an ounce to the low of $883.90 on March 18, said David Barclay, the bank’s commodity strategist, referring to a number that is part of the Fibonacci sequence.
Spot gold is expected to trade lower over the near term, as a potential top continues to unfold. There is “a sell signal in place for now,” said Barclay. Resistance refers to a level where sell orders may be clustered.
Technical analysis is founded on the belief that past trading patterns can be used to predict future moves. Fibonacci analysis uses a mathematical formula based on the theory that prices may rise or fall by certain percentages after reaching a high or low.
A break of one indicates an asset may move to the next, while a failure suggests a trend may stall. Other Fibonacci points include 61.8pc.
The metal last traded at less than $900 an ounce on March 18, when it dropped to as low as $883.90.
“The one-month view for spot gold continues to favour a breakdown below $900, which should allow for a test of $865 to $860 and lower,” Barclay added.
So-called daily momentum indicators, such as the 14-day relative strength index and the stochastic oscillator, are “mostly bearish, and upticks are still favoured to sell into”, Barclay wrote. The 14-day relative strength index is 54.52 and falling, according
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