Gold Update

Gold losing it's Luster over the short term.

On 4th September 2012, we mentioned that a valid breakout above 31,500 could potentially take the rally upwards till 32,850.

But remember only on a VALID BREAKOUT. which did not happen.

As evident from the daily chart above, prices rallied till 32,441 but did not had the strength which led to its downfall. The indicators and open interest clearly show that they started falling even before the fall in actual price.

This already raised the alarm that the ongoing up move could break down any time. Hence, a well aware trader would have capitalised on the opportunity and booked his profit.

Currently, price is finding support zone at 30,600. However, the important thing to be noticed is at this current level Open Interest is flat. (see the flat yellow line in the chart), indicating a state of uncertainty.

Hence, we would advise traders and investors to let this time go by and wait for the next clear trend and only then put in your money.

Wait for the opportunity because wonderful things happen when planning meets opportunity.

Wishing you all a very Happy Diwali.

Team Koyostocks.