The pair of gold / U.S. dollar move forward towards the critical resistance area 0f $ 1444 USD/Ounce of gold yesterday, as the weaker U.S. dollar enticed some investors to return to the market but it was temporary action yesterday.
Wide large operation of selling gold began because of a the slowdown in the Chinese economy and concerns about the debt crisis in the euro zone and expectations that the U.S. Federal Reserve Bank will terminate the asset purchase program earlier than expected. because of the steady improvement in the equity markets of the United States and Japan, is also considered an important factor.
Although there is a growing conviction that the dollar will likely become stronger, the physical demand seems strong at this point. With this, it remains unclear how long this will continue buying sentiment. I believe that the sharp and sudden decline in the price of gold refers to the movement of a strong technical and material in the market.
For this reason, I have no intention to buy gold (long-term) until the technical analyzes indicate that the downward movement has lost its control over prices. From a short term perspective, I will monitor the levels $ 1411, 1400 USD/ounce of gold. Seems that a pair of gold / U.S. dollar will continue to move around the area of $ 1426 USD/Ounce before it choose one of the trends.
Currently, the price to enter an obvious area, and this means that the pair will be limited to the scope of deliberative for some time. Technically, the more thickness cloud of unclearness for gold price, the lower the probability that prices will be able to achieve penetration through. In our case, we will need the pair of gold / U.S. dollar to penetrate above the level of $ 1555 USD/Ounce or below the level of $ 1398 USD/Ounce before we watch a disaster.