June 16th 2012 – Gold Climbs Above 50 DMA Trend Line
Thanks for reading this post. A quick update on how much gold is worth today, June 16th 2012. It’s been a great week for gold. Since we wrote about the bull hammer signal in gold a few weeks ago, price is up $80 from the $1541 close 16th May.
Not only that, but price has surmounted and closed above the 50 Day Moving Average for the first time in more than 3 months. The last time gold traded above the 50 DMA was 12th March. On the daily chart shown below, MACD is rising and RSI has still some room before it moves into over-bought levels. Things are generally looking positive and the next obvious resistance is the 100 Day Moving Average which currently stands at $1661.
Things are looking even better on the weekly chart which indicates that a significant uptrend could be about to play out over the next few months especially with Fall seasonal strength gradually appearing around the corner. MACD is at rock bottom and can only go up now. RSI is below the 50 mark indicating room for growth and most interestingly, the gold price over the past 5 weeks appears to have been carving out strong support at the 100 Weekly Moving Average trend line.
In other news, this weekend will see the re-play of the Greek election since the first one a few months ago resulted in no clear victor. Regardless of who wins, the question the markets need answering is ‘Will Germany step up and help the Greeks with some form of easing to austerity or is it time for Greece to exit the Eurozone?‘
The bailout for Spain has failed to calm the markets and pressure is now building on the Italians. The Eurozone is struggling along with apparently no real solution to the heavyweight burden of debt that they are trying to carry.
The situation is aptly summed up by Nigel Farage (current leader of the euro-sceptic UK Independence Party) who points out that Italy will provide 20% of the funds for Spain for a return of 3% whilst having to borrow the money at 7% ; ”The Euro Titanic has now hit the iceberg and sadly there simply aren’t enough lifeboats”