SINGAPORE: Spot gold is due for a correction despite the fact that it has managed to stand above a resistance at $1,662 per ounce, the 50 percent Fibonacci retracement on the fall from $1,802.60 to $1,521.94.
Chances are there for the metal to edge up to $1,695, the 61.8 percent retracement level. However, this target will provide little trading value as it could also serve as a limit for a further gain from the current level.
A bearish divergence continues to build up on the MACD indicator, strongly suggesting gold is technically very weak now.
The metal needs to drop below $1,643 to confirm a bearish reversal of the short-term uptrend that started at the December 2011 low of $1,521.94.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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