Gold Prices Consolidate at Range HighsGold prices continue to trade near their highs and it would be interesting to see where they close today
Gold prices have continued to trade near the highs of its range as the gold prices traded in the 1295 region for the last 24 hours. We had mentioned in our forecast yesterday that the region between 1295 and 1300 is likely to face a lot of selling and could also lead to a reversal in the prices and we are seeing that there is consolidation here which indicates a lot of selling. This is no surprise as the entire move higher has been quite suspect, from our point of view. The move higher has not been supported by any fundamental or economic events and though there has been some dollar weakness all around, we dont believe that the weakness is enough to push the prices by over $50 within a span of 2 weeks.
Gold Looks to Break Through
This is the reason why we feel that the move could well be reversed when the markets return to full liquidity around the second week of January. Till that time, the moves have to be taken with a pinch of salt. Also, looking ahead to the rest of the day, it would be interesting to see where the prices end up on the last trading day of the year and whether the bulls use this low liquidity to push even higher through the 1300 region to end the week and the year. If that happens, we could be in for more pain for the bears.
Oil prices have finally and decisively broken through the $60 region and continue to move ahead and with this, we believe that the oil producers have achieved their main target of reaching $60. We had been harping on this target ever since the oil prices were at around the $45 region and we have finally managed to achieve this target and it has to be noted that this move had less than 10% of drawdown which makes it all the more sweet.
The silver prices have broken through the $16.8 region and look very eager to move towards the $17 region in due course of time.