Spot Gold Price Chart - 1st May 2009

Spot Gold Price Chart - 1st May 2009

Speculation about possible IMF gold sales, a slightly stronger dollar and gains in equity markets all conspired to pressure the price of gold which only managed to bounce back in late trading once stock markets had reversed some of their gains.  Overall gold lost $8.08 and finished at $886.22 per ounce having attempted to breach the $900 per ounce price point, ultimately failing as risk appetite returned to the markets and closing below all three moving averages.  The key driver moving forward for spot gold will be the impact of the flu pandemic, or otherwise, and if investors decide to move back strongly into equities then this may have a temporary negative effect on spot gold prices, but at present we may be in for a period of sideways consolidation between $870 and $920 per ounce.

With many markets closed in Europe, Asia and around the world, both today and on Monday, my trading suggestion is to wait until Tuesday next week before opening any new positions as any market movement is likely to be based on thin volumes with unpredictable results.

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

Support:    $880.00 (yesterday’s low)                                   Resistance: $922.77 (high of 04/03/09)

Support:    $871.50 (low of 16/04/09)                                   Resistance: $918.50 (high of 27/04/09)

Support:    $864.25 (low of 20/04/09)                                   Resistance: $899.97 (yesterday’s high)