Wednesday’s Technical Analysis: Gold (GLD)
The precious Yellow metal’s outlook is South after extending its corrective weakness Tuesday.
On the Southside
1st support comes in at 1,130.00 a there break points at 1,110.00 where a break opens the way for a move to 1,100.00. A move 1,100.00 if seen could trigger more Southside pressure towards 1,080.00.
Gold’s daily RSI is Bearish and pointing lower indicates more weakness.
On the Northside
1st resistance stands at 1,150.00 where a break points to 1,170.00, then 1,200.00. A break there will turn focus to 1,220.00.
Now overall, Gold is biased to the Southside near term.
India, the world’s 2nd-biggest Gold buyer after China, imposed the import restrictions last year to avert a trade deficit crisis that pushed the Rupee to record lows.
“Restrictions placed on import of Gold… stand withdrawn with immediate effect,” India’s central bank said in a statement on Saturday, 29 November.
Support for Spot Gold comes from jewelry demand from India in the lead up to and during the wedding season, which starts again in late September. India did record a 176% increase in Gold imports in August to US$2-B from about US$756-M.
Overall, the impact of wedding season Spot Gold buying has faded in recent times as India is no longer the world’s largest Gold consumer, partly because of the on-going government import restrictions on precious metals. If they are further relaxed, perhaps India will regain its Top spot.
India’s Akshaya Tritiya festival considered by India’s more than 900-M Hindus as an auspicious day to buyGold and Silver, fell on 21 April this year. Bullion is bought in India during festivals and marriages as part of the bridal trousseau or gifted in the form of jewelry by relatives.
Stay tuned…
HeffX-LTN
Paul Ebeling
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