Sell Gold on pullback to USD 1708: Geojit Comtrade

Geojit Comtrade has come out with its trading strategies on Gold. According to the research firm, one can sell on Gold on pullback to USD 1708 for the target of USD 1694 with a stop-loss above USD 1720.

Spot gold edged lower pressured by a weak Euro and news that Goldman Sacks cut its gold outlook for 2013 period. Investment bank Goldman Sacks cut its gold outlook for next year and said gold may turn due to rising interest rates and better growth prospects putting a lid on further monetary stimulus. Meanwhile the US policy maker’s talks over the fiscal cliff still weigh on investor’s confidence. Physical demand for gold from Asia has improved as weak prices attracted more bargain buyers in the counter. Gold’s investment demand still looks firm with holdings of gold backed exchange traded funds being placing at record peak levels. Anyhow, European Central Bank’s interest rate announcement and policy meeting due today would be curiously watched out by investors as they widely anticipate a guide to its next year’s policy path in the meeting. Friday’s US Non-farm payrolls data is the other event that could provide fresh direction for bullion this week. After a convincing violation below $1700, the outlook looks gloomy and now prices are on a track to test its next support of $1684/1662 levels. Prices are trading well below the trend channel and 100 day moving average supports favouring more downside pressure in the coming period. The enduring chart formations are also supportive for more liquidation towards $1662 followed by $1625 later. For the day, an initial upside correction may be seen before prices drift lower but an unexpected turn higher above $1710 could negate such bearish expectations and take prices higher. RSI is placed at the oversold region while the volumes are steady. Trading strategies:

• Key levels for the day: Downside immediate: 1684/1662 followed by 1625/1600
• Upside Immediate: 1708/1718 and then 1732 followed by 1752/1775/1784/1800.
• Sell on pullbacks to 1708 target 1694 SL above 1720. Sell if unable to break 1775 target 1750 SL above 1787.
• Sell below 1684 targets 1662 SL 1700. Sell below 1662 target 1625 SL above 1689.
• Buy above 1721 target 1731 SL 1715. Buy if unable to break 1684 target 1706 SL 1662
• Buy above 1755 target 1770 SL below 1748.
• As long as prices stay below 1700, liquidation pressure is likely to pursue but an initial upside correction may be seen before hefty selling.
• MCX Feb: Intraday Levels are: Resistance seen at: 31330/31580/31800. Support: 31030/30820/30640/30500.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. To read the full report click on the attachment

Read More