As investors await this week FOMC meeting, talk of a potential QE3 has started to make the rounds. Inflation is continuing to grind lower and the US Federal Reserve feels they have the ability to maneuver rates to boost employment
The increase in liquidity that will likely come from not only the FOMC but additionally the PBOC, which is at the beginning of an easing cycle, could push gold prices higher which is already occurring.
Gold prices have pushed up to trend line resistance and are poised to break to the upside.
Gold is poised to test trend line support at 1677, and a close above this level is likely to target resistance at 1762, and then 1802. The recent close above both the 50-day moving average and the 200-day moving average are supplying robust support. The MACD is strong near 7.44, with the 12-day moving average spread with the 26-day moving average, moving away (upward) from the 9-day smoothing of this momentum indicator. This should perpetuate upward momentum.
The trade – purchase a daily binary call option on Gold on a daily close above 1678 with a cap at 1700.
Signal Summary
Asset : Gold
The trade : Binary Call Option
Expiry time : End of day
When : on a daily close above 1678 with a cap at 1700.
Result : Marked N/A as the daily close was above 1700
