Good day forex traders and readers.
Welcome to another gold price review as we monitor the price development of the precious metal. From 2008 to September 2011, gold has hit a record price of $1923.70. It has since then hit a bearish slowdown and many investors see great opportunities at the current price level.
In the previous forecast we noted that $1200 might serve as an support. Concerns were present regarding the US Federal Reserve apparent intention to taper quantitative easing measures.
Looking at the Gold six months chart above we note that the $1200 region did serve as a support of sorts as the precious metal corrected in price. It is now supported by $1300 and the immediate resistance is likely to be the $1350 region.
Close observation indicates that we are not quite out of the long term bearish channel yet and this may merely be a short term correction. Hence it is crucial to monitor closely to confirm if the bearish channel would be breached. If so, we may then expect a bullish target of $1400.
The recent US Non-Farm Payroll came in worst than expected. With the number of jobs created lower than expected, a number of traders are speculating that the possibility of the US Federal Reserve tapering quantitative easing in the near future will be further reduced. This may lead to better bullish prospect for gold if the US dollar weakens.
It would be good to continue monitoring economic developments in the US so that we can gauge the probable response of the US Federal Reserve.