Gold Finds Support At $900
By Colin Twiggs
March 25, 2008 3:00 a.m. ET (7:00 p.m. AET)
Spot gold is consolidating above support at $900 — which is expected to hold. Breakout below this level, however, would breach the rising trendline and signal weakness in the primary up-trend.
May 2008 Light Crude formed an open-close reversal signaling strong support at $100. Expect consolidation between $99 and $102.50 followed by an upward breakout (crude is after all in a primary up-trend). A fall below $99, however, would signal a test of primary support at $86.
The strong primary up-trend continues on the weekly chart.
The euro found short-term support at $1.53. Penetration of this level would test long-term support at $1.50. Gold and the euro tend to move in sync, so I am expecting a stronger retracement. Respect of support at $1.50 would confirm the strong primary up-trend.
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The dollar retraced to test short-term resistance at 101.50 yen. Respect of this level would confirm the strong primary down-trend, with a target of the all-time low at 80.
The Australian dollar continues in a descending broadening top. Expect strong resistance at $0.9450 to $0.9500. A failed up-swing would warn of a breakout and test of primary support at $0.85.
The Aussie also displays a descending broadening pattern against the yen. Expect strong resistance at 100. A failed up-swing or (downward) breakout would offer a long-term target of 86-(108-86)=64.
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