Spot Gold Price - Daily Chart 19th February 2009

Spot Gold Price - Daily Chart 19th February 2009

One step closer to the $1000 mark could probably describe spot gold’s performance yesterday, which continued to move up hitting a new high of $987.28/oz and in line with my own analysis, based on the daily chart. Earlier this week, the Obama administration unveiled what was described as the ‘US government’s most aggressive attempt to deal with the foreclosure crisis’ pledging billions of dollars, but markets remained unimpressed, either because the plan is still considered short on details by some or because the efficiency is still debated. One thing though is generally agreed, as a result of the stimulus package at some point in the future inflation will come back which in turn is more good news for gold prices! In the short term, if you are trading today on an intra day basis, then I would be slightly cautious as it is always too easy to simply open a trade based on the last few days and go long. Remember, that whilst the trend is still very bullish there will be short term profit taking after such a rise, so expect a down day shortly, which may come today. For longer term positions I suggest you continue holding these open, and move your stop loss position up to the $940 level, locking in some profit. The candle from yesterday, gives no indication of a reversal at the moment with a wide spread up bar once again, but as always it pays to be careful, particularly when we are making money, and become over confident!!

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

Support:    $960.30 (yesterday’s low)                                    Resistance: $1000.00 (psychological level)

Support:    $944.47 (9 day moving average)                               Resistance: $988.40 (high of 15/07/08)

Support:    $939.70 (low of 17/02/09)                                    Resistance: $987.28 (yesterday’s high)