Gold Edges Up On Declining Volume

Gold is stepping up casually from yesterday’s lows in reaction to a broad-based depreciation of the greenback.  However, volume is declining to the upside, while the precious metal hasn’t managed to get back above our 2^nd or 3^rd tier trend line or into the thick of the trading range from last week.  Therefore, the outlook for gold still has a negative tint to it, especially since crude and equities are presently trading in disadvantageous positions.  On the other hand, the Cable and EUR/USD have made encouraging pops over the past 24 hours, giving some hope to gold’s uptrend since they are positively correlated.  In all, gold is trading in a confusing range, and seems undecided as far as which direction to head in.  The mixed performance of gold’s correlations shows that it’s best to be in a neutral position as the markets sort themselves out.  The U.S. will report some key economic data today along with the Fed’s monetary policy decision.  Hence, we could get a clearer picture by tomorrow.  We maintain our negative outlook trend-wise on gold for the time being since the downside still has momentum on its side.

Present Price: $927.30/oz

Resistances: $931.41/oz, $935.62/oz, $939.82/oz, $941.85/oz, $943.88/oz

Supports: $923.96/oz, $927.40/oz, $920.95/oz, $917.49/oz, $914.99/oz

Psychological: $950/oz, $900/oz

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