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GOLD DECEMBER TECHNICAL LEVELS
SUPPORT
RESISTANCE
S1
S2
S3
S4
R1
R2
R3
R4
$709.10
$712.00
$719.00
$728.60
$732.00
$739.60
$745.50
$754.00
GENERAL MARKET CONDITIONS
Gold has risen due to safe haven status. If the equity markets continue to rise, safe haven demand may come down, which should result in a short term correction in prices while maintaining the bullish direction intact. The effect of Fed cut’s on US economy by way of stronger US economic growth will take time, but the outlooks remains better than it was last week. However a weaker US dollar will prevent major losses for gold. Overall spot gold can rise to $750-$770 over the next few weeks. Silver hopefully should attract fresh fund interest which should result in $14.30 and $15.30 before the close of the year.
The Fed by acknowledges that the US economy is in tatters as it cut the interest rates and discount rates by half a percentage. Equity markets are expected to rise another eight to then percent from the current levels over the next few weeks. The US dollar will weaken further on interest rate differentials. Over the past few months, we have seen a very strong correlation between US equities and carry trades. Carry trades will result in further gains in gold and silver. However base metals and energies will rise the most as far commodities are concerned.
It will be a technical trade for gold, silver and commodities. Major central bank meetings are over. Precious metals will be affected by directional changes in US dollar and energy prices.
GOLD -- DECEMBER FUTURE
Gold targets $754 as long as it floats over $726.60. A consolidated fall below $726 will result in $722 and $714.0
NYMEX CRUDE OIL --FUTURE
Crude oil targets $86 as long as it floats over $80.0. Key Support at 77.60
Happy Profitable Trading
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