Spot Gold Price Chart - Daily Gold Prices 26th May 2009

With markets closed in both the US and UK for a national holiday spot gold prices drifted for most the day and ended one dollar down closing at $956.05 per ounce.  From a technical perspective the candle finished as a long legged doji suggesting that the market may be reaching a short term turning point, particularly as this followed last Thursday’s candle which again had deep shadows to both top and bottom once again suggesting  short term indecision.  As a result of these two candles, but bearing in mind that yesterday was against the backdrop of very thin volumes, we may see a temporary reversal in spot gold prices possibly today and tomorrow as investors take profits and digest the fallout (pun not intended) of the North Korea nuclear test situation.   Gold prices may also be preparing themselves from problems which are emerging in the bond market where the yield on 10 year Treasuries has jumped over 90 basis points since March.  The fear is that the US may be engineering a stealth default by allowing the dollar to slide which would only benefit the spot gold price.  My trading suggestion for today is to look for buying opportunities on any reversal today and tomorrow using the longer term intra day charts such as the hour or 4 hour.

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

Support:    $951.60 (yesterday’s low)                                   Resistance: $967.00 (high of 20/03/09)

Support:    $946.05 (low of 20/03/09)                                   Resistance: $962.50 (high of 19/03/09)

Support:    $935.55 (low of 21/05/09)                                   Resistance: $959.80 (yesterday’s high)