Spot Gold Chart 20th May 2009

Spot gold prices ended the day $7.30 higher to settle at $925.75 per ounce reversing much of the loss of Monday and closing above the 9 day moving average and all three moving averages once again.  With equities markets having a more stable day it was left to the slighter weaker US dollar and worse than expected housing starts data which helped to lift spot gold prices.  From a technical perspective yesterday’s up candle would seem to suggest that the bearish signal of Monday has not been confirmed although to be absolutely sure we need to see a move back above the $930 – $935 price points once again at which point we can assume that the bullish momentum of the last few weeks remains in place and that Monday was simply market players taking profits from the recent gains.  With all three moving averages pointing higher there is no reason to suppose that this momentum will not continue for some time and our initial target is the $950 to $955 area which should be re-tested once again in due course.

The short term trend is sideways while the medium and long term trends are bullish.

Support:    $917.30 (yesterday’s low)                                   Resistance: $940.70 (high of 25/03/09)

Support:    $911.25 (low of 12/05/09)                                   Resistance: $936.15 (high of 27/03/09)

Support:    $908.20 (low of 11/05/09)                                   Resistance: $929.10 (yesterday’s high)