Charts Show Gold Sell-off Could Get A Lot Uglier
If the yellow metal slides below a key support level of USD 1,150, the selloff could accelerate to USD 1,030 or even USD 870 an ounce - levels not seen since 2008 during the global financial crisis, Victor Thianpiriya, commodity strategist, Asia at ANZ wrote.
From a technical perspective, the outlook for gold is looking increasingly bearish, according to analysis by Australia New Zealand Bank (ANZ) , which says the recent sharp declines open the risk of much sharper corrections.
If the yellow metal slides below a key support level of USD 1,150, the selloff could accelerate to USD 1,030 or even USD 870 an ounce - levels not seen since 2008 during the global financial crisis, Victor Thianpiriya, commodity strategist, Asia at ANZ wrote.
"Closing near the lows of the month [June] underscores the risk of much deeper corrective declines... Caution is therefore, key," Thianpiriya said.
"Volatility remains high. At times like this, the market can ignore fundamentals, and the technical picture takes on greater importance," he added.
Last week, gold fell to its lowest level since 2010 at USD 1,180, with losses in the precious metal amounting to 22 percent since the start of the aggressive selloff in mid-April.
The yellow metal posted its worst quarterly performance on record, down 23 percent over the April-June period.
Relentless selling by exchange traded funds (ETFs) has been behind the poor performance of the precious metal in the recent months, outweighing physical demand for jewelry, bars and coins.
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This type of reasoning baffles me... Gold has just sold $600 in 6 months and now this is a sell signal???
Why do TAs wait for huge moves to jump on a trend instead of identify weakness when gold started going lower from its 1,800 highs?
Personally, I don't like gold. I remember it trading at $350 in the 1990s, so being anchored to that price means that $1,200 is too high. That said, why would anyone want to sell an asset AFTER it has retraced $600? At best be neutral or even consider buying for a short-term rebound. This reminds me ppl saying to short AAPL after it goes from $700 to $400.... why is it a better short at $400? The risk-reward scenario is awful to short after such a large fall already.
This type of foolishness of jumping on a trend late and after a big move is what separates retail investors from the pros. Sure six pack Joe can short Gold here and take his profit if it goes to $1,000 but the risk-reward is dismal.
Not overwhelmingly familiar with commodities, is it common to call gold "the yellow metal"? Seems quite stupid to me.
so some research people in banks really believe in technical analysis??
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