Spot Gold Prices - Daily Candle Chart 17th February 2009

As expected we saw a quiet session in spot gold prices yesterday due to the Presidents Day holiday in the US with the yellow metal gaining just over 2 dollars in a very thin market. Lately gold has been supported by a tidal wave of money flowing into gold exchange traded funds (ETF’s) some of which constantly hit record highs. Despite incredibly weak demand for jewelery for this time of the year, especially in Asia , gold prices are going from strength to strength as ETF shares are actually backed by gold in storage, thus creating an extra physical demand. The candle for yesterday was a small doji, with the bulls still in control of the market as the move lower in early trading was quickly reversed. The bullish trend is still firmly in place and I would suggest small long positions for today with a stop loss below the $890 per ounce region as we begin to approach the psychological level or $1000 per ounce once again for spot gold.

The short, medium and long term trends are all bullish.

Support:    $935.45 (yesterday’s low)                                    Resistance: $953.00 (high of 12/02/09)

Support:    $927.68 (9 day moving average)                               Resistance: $947.42 (high of 11/02/09)

Support:    $920.25 (14 day moving average)                              Resistance: $944.20 (yesterday’s high)