- Sumitomo Corp. Global Research (based on Bloomberg)
We received a strong bullish signal yesterday, as gold effortlessly pierced through a dense resistance area, which was initially though to be able to hold the bulls at bay. This means the price is highly likely to keep increasing, while the next serious level will be only at 1,205 dollars, represented by the monthly R3. However, this resistance is unlikely to stay intact for long. Above it XAU/USD will continue its journey towards 1,230, where the highest level since May merges with the major falling resistance trend-line.
People trading gold seem to ignore gold's recovery. The sentiment has hardly changed since yesterday: the share of longs only fell from 52 to 50%. There are also no significant changes in the longer-term perspective: five days ago 53% of all open positions were long.