Spot Gold Price Chart - Gold Prices 11th May 2009

Slightly better than expected non farm payroll data prompted gold traders into a round of profit taking as equity markets responded favourably to the possibility of a flattening in unemployment and a small positive signal that the worst may now be over.  However, the late trading session also witnessed renewed dollar weakness as inflation concerns began to emerge and spot gold prices ended the day slightly higher gaining $2.68 to settle at $916.05 per ounce.

From a technical perspective the low of the day bounced off the 40 day moving average and with the candle forming a long lower wick, this suggests that we could see a move higher in the price of gold today.  In addition the 9 and 14 day moving averages are crossing adding weight to this bullish view.  With little in the way of obvious resistance ahead the way should now be open for a move in the price of gold to re-test the $930 per ounce level and if this is cleared we could see a subsequent higher to $950.00 and above. My trading suggestion for today is to look for small long positions on an intra day basis, buying on any dips in the market.

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

Support:    $904.65 (Friday’s low)                                      Resistance: $933.20 (high of 01/04/09)

Support:    $895.30 (low of 06/05/09)                                   Resistance: $929.12 (high of 02/04/09)

Support:    $884.05 (low of 04/05/09)                                   Resistance: $920.05 (Friday’s high)