Friday, January 8, 2016

Gold Analysis As At January 8, 2016

Which Direction For Gold? What Analysis Is Best?

With the Gold price closing today at approximately $1,104.00 many people are starting to wonder the longer term direction. There are bearish and bullish factors to be included in any analysis.
The Federal Reserve is scheduling rate increases for 2016 and those may be bearish for the Gold price.
"The United States continued to import large volumes of gold jewelry in October," Erica Rannestad, senior analyst of precious metals demand at GFMS, said in an email late on Wednesday.

Gold has had a move higher in the past few days and then, today eased back. However, the result is a higher price than last week.

As this chart from Bloomberg shows, Gold is correlated with the Asian markets, as Asian markets rise, Gold falls and vice versa.

Gold Correlation with Asian Markets


These charts are using the Ichimoku Cloud, Harmonics to show Resistance and the Commodity Channel Index to show Divergence.

I have a couple charts here.


Price has met resistance as it tries to move through the Ichimoku Cloud. We will see next week if there is going to be momentum to rise further.


Similarly price has retreated from the Harmonic line.


This Commodity Channel Index chart shows a couple Bullish Divergences which were probably a clue to the rise in price.
One more chart should be added here, a chart showing a Bearish Fibonacci Pattern. We may see a reversal in the next day or two based on this pattern.


The jury is still out regarding the direction for Gold Price, however there seems to be a bearish attitude at this time. The rise in the past few days seems to reflect the correlation with Asian Indices, traders running for cover as the Chinese markets fluctuate.
The daily charts show a double bottom which may indicate that a rise is about to occur, however, it is too early to know if it will be significant move.

A couple articles with some further insights into Gold.

Gold price: fears the 'safe-haven' rally is over - The Week UK
Fri, 08 Jan 2016 11:04:28 GMT
The Week UKGold price: fears the 'safe-haven' rally is overThe Week UKThe spot gold price touched $1,112 during the session in Singapore, its highest since the beginning of November, but fell back sharply to around $1,097 this morning amid a recovery for Chinese equities after Beijing allowed some appreciation in the yuan.Gold Rises Again Amid Global Market TremorsWall Street JournalGold hits nine-week high as China worries hit stocksCNBCGold futures score five session gains in a row
Anxious Over Global Market Turmoil? Here Are Your Best Gold Investments Now -
Fri, 08 Jan 2016 18:14:00 GMT
TheStreet.comAnxious Over Global Market Turmoil? Here Are Your Best Gold Investments NowTheStreet.comWith Chinese markets holding global equities hostage -- once again -- and the dollar falling as well, gold has hit a nine-week high. The logic for this upswing is simple: Investors are channeling money into what they believe are safe, hard assets that ...Gold falls further from nine-week high after upbeat US data

Gold slides, but scores best weekly gain in over 4 months - MarketWatch
Fri, 08 Jan 2016 19:49:00 GMT
MarketWatchGold slides, but scores best weekly gain in over 4 monthsMarketWatchGold futures settled lower on Friday for the first time in six sessions after a better-than-expected U.S. employment report buoyed the dollar and dulled some of the metal's investment appeal. For the week, however, gold scored a gain as investors ...
Silver Seen Beating Gold as Ratio Rises to Near Historical Peaks - Bloomberg
Fri, 08 Jan 2016 12:36:56 GMT
Silver Seen Beating Gold as Ratio Rises to Near Historical PeaksBloombergGold has fared better this week as global market turmoil and geopolitical tension in the Middle East and Asia prompted investors to seek a haven. Silver has lagged because industrial uses account for half of its demand, compared with about 10 percent ...and moreļ¾ »

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