Gold price technical analysis 20 – May, 2013 — the pair of gold / U.S. Dollar declined after a report showed issued by the University of Mich. that the consumer sentiment index rose to 83.7 from 76.4.
After the falling of gold price for 7 days in a row, gold prices settled at $ 1,355.57 USD/ Ounce on Friday, which is the minimum closure since the date of 16 April. U.S. dollar got support after an announcement from the chairman of the Federal Reserve Bank in San Francisco, “John Williams,” that the central bank may be Garda to begin to reduce its purchases of assets by the summer.
In addition, recent data from the U.S. and the euro zone, showed that inflation is under control in both regions. Seems that the statements had started to become a dominant force in the market again. As a result, the U.S. data will reinforce expectations that the Fed could terminate the asset purchase program, by its own before the end of the year.
The price of gold is exposed to strong selling pressure since the barrier penetrated below support level at$ 1532 USD/Ounce, which was a bottom over the past two years, and this configuration down heavily on the daily market indicating that lower prices may be on the way. Now back to the level of support at $1398 USD/ Ounce, and if it continues the downward movement to control Gold price, based on standards, I think we will get to the level of $1266 USD/Ounce in the near future.
On the way down, expect to see support at $1336, 1320 and 1308 USD/ Ounce of gold. In case the pair stopped falling, there will be resistance at $1363, 1378 and 1398 USD/Ounce. So we can say that we will watch a harsh fluctuate in gold market today, we will be waiting for New York Spot market to say its word about gold price, and to decide the next trend of gold if it is going to cure today or not.