Gold prices dropped during the majority of the session on Monday, but rebounded somewhat from the problem of drawing the hammer. The biggest problem is certainly the fact that this hammer is situated amid a large congestion, and therefore do not see that it has considerable weight. With this situation, we are waiting now, Mr. Bernanke’s remarks before the U.S. Congress later this week to see if there will be a possibility for further quantitative easing.
Through the movement of many of the commodity-linked currencies, it seems that there are many expect Bernanke to say something. It is based on weak sales data, released Monday morning also, so this will push many people to think that the Fed will feel the need to intervene and do something.
With this, markets will not move much and will remain cautious until after the Bernanke speech. With the movement of stock markets on Monday, it seems that there are many traders in the United States think that Mr. Bernanke will indicate the type of additional easing. For this we may see some sudden movements in the gold markets during a session on Tuesday, where it will show real momentum and penetration of the recent consolidation. If we get the signal, we will take a long position and wait for traffic to reach the level of $ 1700, maybe even $ 1,800.
When looking from the bottom side, we do not see a lot of space down to get below the $ 1500 level. This is expected based on the fact that the level of $ 1500 will be an important area psychologically with certainty, so expect some sort of reaction with respect to support. In general, we prefer to take a long position in this market, and we see that many central banks around the world have started a new round of facilitation. And the fact that this is priced in dollars, we see the Fed does this matter in order to accelerate this market to the upside.