Spot Gold: Becoming Overbought
Jason Sen | Mar 18, 2014 03:21AM ET
Gold had become very overbought as we warned yesterday and collapsed as far as our lower buying opportunity at 1360 over night. We have over run a little to 1357 but there is a good chance of a rally from here today. We are looking for a bounce to 1365 and perhaps as far as 1371/72 with a high for the day likely as the longer term outlook has now turned negative. Use this as a selling opportunity therefore with stops above 1377.
Failure to hold on to support at 1360/57, however risks a continued slide to Fibonacci and 6 week trend line support at 1350/49. Exit shorts and try longs but be aware we could just test better Fibonacci support at 1343 so if possible, buy a little more here with stops below 1339.
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