GOLD @ $1105

 Gold has been weak since the High ($1227) on Thursday 3rd December 2009. It's currently resting on support at the weekly  10ema of $1105. A weekly close below $1105 would imply a test of support around $1070 (20ema). I will let the market show its hand first and look to top up on GOLD holdings around Friday 15th Jan 2010. Looking for GOLD to make one further move up from $1050 to $1300. If $1030 is broken, I will wait for a dip below $1000 to add to my long term holdings. Failure to break the recent High by the end of March 2010 will be a RED flag to the GOLD bulls. Gold will then be entering a seasonal weak period from April-Aug 2010.

GOLD Corrections

Gold got 40% above its 350-day moving average on May 15, 2006; it fell 25% from 720 to 542 in 21 days. Gold also got 40% above its key moving average on March 17, 2008; it declined 18% from 1032 to 850 im 30 days. Gold was 34% above its 350-day moving average at the start of December. A similar fall would give a GOLD price target of $920 (25%) or $1010 (18%) by 14th Jan 2010.

Note:

On a Daily basis GOLD gave a SELL signal on Friday 4th December with a close below $1175

5ema($1099) > 10ema($1109) required to go Long on GOLD. Short GOLD on any retest of 20ema($1120) in the next few days with a Stop at $1130.