Gold futures are up today pushing price above a test of bottom established on the daily GC Gold Contract.
We also have seen three quick pushes down in the relevant indexes, the TTGD:TSX and $HUI AMEX Gold Bugs Index. Its likely that this move up is largely due to technical trading and simple price exhaustion, given the rapid move down since the start of April. Just look at how Gold has fared on this percent change chart comparing Gold and other sectors and broad indexes:
The question du jour is whether the Gold Contract will hold above this test of bottom or not, and whether a move up here should be used to initiate new positions, or to lighten existing positions if investors have ridden the Gold complex all this way down.
We know that the price of Gold is inversely related to the fortunes of the US Dollar. While the dollar has been moving up against other major currencies for several months now, today there has (so far, prior to the FOMC announcement) been a number of 1%+ moves in currencies against the dollar including the Euro, British Pount, Swiss Franc.
With the upcoming 2:15 announcement from the Federal Reserve we will have both currencies and Gold to watch to determine how long lived this move up is likely to be.
04.05.04 10:20 #