As of this morning gold is near the 1788.00 price and is within sight of rather interesting short term resistance levels. The past two days of trading has seen the commodity trade above the 1790.00 mark, but gold has not been able to seriously challenge the 1800.00 juncture which was last seen on the 6th of August.
Intriguingly it was the 6th of August which also produced the elevator down in gold and saw a low of nearly 1680.00 momentarily challenged before buyers stepped in and stabilized the commodity. While the technical flash crash was bewildering for many traders it should be remembered gold is not a cryptocurrency and it is doubtful the commodity will suffer an intolerable and everlasting loss of value, this unless civilization changes its entire economic premise.
Yes, gold certainly remains vulnerable to rises and falls in value as it is speculated on and invested in by financial houses. The current resistance levels for gold are nearby and may prove to be vulnerable near term the junctures of 1793.00 to 1798.00. From a risk reward perspective taking into consideration that shattering flash crash seen on the 6th of August it may appear foolhardy to say there is limited risk to the downside. However traders with a speculative nature who use stop loss ratios may be keen to be buyers of gold on slight reversals lower which test the 1786.00 to 1783.00 ratios.
If support near the 1780.00 juncture is sustained this could be a legitimate signal that gold is about to incrementally increase again. On the 29th of July and 4th of August the commodity was trading near the vicinity of 1833.00. Speculators should not get overly ambitious and limit their trading goals to current resistance levels. The 1800.00 sincerely needs to be tested and punctured higher before a change of sentiment can be expressed in the gold market.
Traders who remain skeptical of the stability within the gold price and expect additionally selling momentum to be produced should not expect to see an additional flash crash suddenly emerge. Support levels near the 1780.00 to 1778.00 does look rather durable in the short term and these may prove to be solid short term targets as take profits values for traders with bearish sentiment.
Gold Short Term Outlook:
Current Resistance: 1797.00
Current Support: 1778.00
High Target: 1815.00
Low Target: 1766.00
