Jun 30, 2011

Silent gold correction

Gold is considered safe haven and long term chart proves it. Latest movements indicate slowing of price growth, but is that start of deeper correction?
Macro view of the picture still supports the precious metal. Debt problems around the world suggests vulnerable currencies. Capital markets reflect rising system risk and only store of wealth seems to be obvious. The big gold rally could be stopped if money become expensive i.e. FED starts tightening, but this is not expected at least until the year end. Still gold looks like good pick.
Closer look at the chart shows triangular technical pattern. This is corrective move usually confirmation of the trend. Considering again declining dollar short term target of $1551 is reasonable.
Gold In Consolidation

Chart source: dukascopy.com, Chart analysis: investink.net

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