Gold Prices See Meltdown - Watch Out Below
Gold–What a difference a week makes. Last week I effectively said Gold wasn’t worth trading, but this week it’s the biggest move of any major currency. There’s big risk of further Gold price losses.
Trade Implications – Gold: Retail traders have been all-too-happy to buy into these dramatic gold price declines, and the post-FOMC Gold meltdown is not exactly a sign of healthy markets. There are almost 2 traders long Gold for every one that’s short, and that ratio is gaining. Could XAU bounce? Sure—anything’s possible. But our markets strategist doesn’t see Gold price support until 1273, and increasingly one-sided sentiment warns against joining the crowd in buying at these levels.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.