Gold should be monitored closely by speculators today. Only two days ago, the precious metal was flirting with important short-term support near the 1775.00 vicinity, but gold has seen a polite reversal take place and its value as of this morning is hovering near the 1800.00 ratio. Having traded towards a short-term high around 1805.00, the commodity hasn’t exactly lit the speculative world on fire with its trend, but the rather cautious movements seem to suggest volatility will be demonstrated again.
The past month of trading has been filled with wicked price swings within gold, and the potential to remain above the 1800.00 may prove rather interesting to speculators who favor buying the commodity. Short=term resistance marks are rather close and have proven durable; this may produce rather nervous sentiment among traders who favor buying positions. However, if gold can break the 1808.00 level and begin to traverse near 1810.00, this may add to positive sentiment.
If gold were to break below the 1798.00 level though, alarm bells could be turned on and bring out speculative bearish positions. In the past week of trading, the 1776.00 level has proven to be a rather magnetic force field for gold. Selling momentum below the 1793.00 level may prove a strong signal for additional selling to build.
However, bullish speculators who continue to have an optimistic viewpoint about gold may look at slight price action below the 1800.00 level as an opportunity to go long. Timeframes are certainly important for all traders, but market participants with the capability to withstand overnight positions and have reasonable transaction costs as they trade gold, may find there is an advantage as buyers near term.
Cautious traders who want to buy gold near lows could decide to wait for slight reversals lower. The commodity is certainly traversing an important price ratio near the 1800.00 mark, but if this level proves adequate and is able to sustain its technical structure short term, this may be a signal additional buying may be exhibited sooner rather than later. Traders should certainly use stop loss protection, but buyers of gold may be able to use tight values to guard against potential downturns as they wager on upwards momentum to ignite.
Gold Short-Term Outlook
Current Resistance: 1809.00
Current Support: 1798.00
High Target: 1818.00
Low Target: 1793.00
