By Russell Glaser – Gold prices retreated from their all time high, but yesterday’s pull back in the price was limited due to the price running into a significant support level.
The price of spot gold fell to $1235.10, down from the commodity’s opening day price of $12360.60.
The drop in the price of spot gold was restrained when compared to the price volatility the commodity has seen as of recent. The price of spot gold has risen 14% in the past 7 weeks.
Per the spot gold daily chart below:
1. Yesterday’s price decline that was halted the near the support line of $1224.50.
2. A short term trend line that shows the sharp price appreciation for the past 7 weeks.
3. A long term trend line that takes into account all the price action.
4. Support at $1169
5. Support $1058.65
Traders can use the support and resistance lines when trading spot gold. Depending on the time frame and direction of the trade, the prices mapped out below should serve as areas for setting stops and limits for reducing risk and potential profit taking.
Forex Market Analysis provided by Forex Yard.
© 2006 by FxYard Ltd
Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.
