Looking for Lower Prices to Buy Gold
Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources.
The debate continues on and on in the gold market. Some analysts believe gold could be the largest bubble since the housing market and it's going to burst. Gold bugs remain bullish touting gold's apparent imperviousness.
To the bear camp's credit gold has given me a sell signal today (7/26) on the daily charts with both the 9 and 20 day simple moving averages pointing down. This is the third sell signal I have received on the daily charts since gold changed trend to the downside on July 2nd. The 9 period moving average on the weekly chart has also begun to point down.
Adding to bearish factors are European bank stress tests last week and this morning's better-than-expected housing report both seem to have lowered trader anxiety, increased risk appetite and reduced demand for "flight to quality" instruments like gold.
That being said I wouldn't count gold out yet. Gold still looks good on the monthly charts, with some decent support around the $1160 mark. The stochastics indicators are rising from oversold levels which could also support higher prices. And the dollar continues to plummet which should, in theory, bolster gold prices.
In my opinion I'm looking for lower price opportunities to buy gold.
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Futures, options and forex trading is speculative in nature and involves substantial risk of loss. All known news and events have already been factored into the price of the underlying commodities discussed.
