Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold In India: Did Gold Stop to Respond to the Rupee Price Moves?

Commodities / Gold and Silver 2013 Sep 14, 2013 - 10:03 AM GMT

By: Nadia_Simmons

Commodities

Today, gold in the global market reversed early gains and fell to its lowest in more than a month as U.S. futures extended losses on fears the United States would curb its stimulus soon and as a U.S. strike on Syria looked less likely.

According to Reuters, purchases from jewelers in Hong Kong and mainland China initially helped gold gain more than 0.5%, but heavy selling of New York COMEX and bullion futures on Tokyo Commodity Exchange pushed the price of gold below $1,330 per ounce.


Gold in India, the world's top consumer of the precious metal, fell to its lowest level in three weeks following losses in the world market.

What impact did these circumstances have on the gold’s chart? Where are the nearest support zones and resistance levels? Let's take a closer look at the daily chart and find out what the current outlook for gold priced in rupees is.

Since my previous essay was published, that the situation has deteriorated once again.

Quoting my previous essay on gold in India from September 11:

(…) When we factor in the Fibonacci price projections, we see that the 1.618 ratio was broken today. If the gold bulls don’t manage to push the price higher from here, the next price target for the sellers will be around the 1.732 ratio at Rs 85,514. It’s worth mentioning that this ratio is slightly above the 61.8% Fibonacci retracement level based on the upward move from the August low to the August top (around Rs 85,449 per ounce). This area is also supported by the 45-day moving average (currently at Rs 85,090). If this strong support zone is broken, the next support level will be close to the 50% Fibonacci retracement level based on the entire June-August rally.

As you see on the above chart, gold priced in rupees broke below all these levels during today’s session. The buyers failed and gold bears did not give them any chance to improve the situation and initiate an upward move.

In this case, the next price target for sellers is around the 76.4% Fibonacci retracement level (based on the upward move from the August low to the August top). However, the strong support zone is between Rs 81,369 and Rs 81,601, where the 61.8% Fibonacci retracement level based on the entire June-August rally intersects with the June top.
Taking the above into account we see that there is still much room for further declines.

Once we know the current situation in gold priced in rupees, let’s take a look at the INR/USD chart and find out whether the relationship between gold and the INR/USD exchange rate still exists or not.

On the above chart we see that the situation hasn’t changed much in the decent days.  

Quoting my previous essay on gold in India from September 11:

(…) the Indian rupee reached the 50% Fibonacci retracement level based on the entire July-August decline. Today we saw a small breakout above this resistance level (but only on an intraday basis), which is not yet confirmed.
Taking the above into account, in the following days we may see a corrective move to the previously-broken declining resistance line based on the July and August 12 tops.

On the daily chart we see that there hasn’t been a decline to this declining line so far. Instead of this a consolidation has formed in the recent days. That’s why we should consider two scenarios. If the buyers do not give up and push the price above the Wednesday’s high, the INR/USD exchange rate will likely climb to at least the 61.8% Fibonacci retracement level. Please note that this area is also supported by the 38.2% Fibonacci retracement level based on the entire May-August decline. However, if they fail and the rupee drops below the bottom of the consolidation, we will likely see a decline to about 159 level.

Summing up, taking all the above facts into account the we see that the Thursday’s decline didn’t trigger an upward move in gold. In other words, the recent negative correlation didn’t’ work this time. Additionally, it seems that today’s small bounce up in the INR/USD exchange rate pushed the yellow metal even lower. From today’s point of view it’s hard to estimate whether this tendency changed or it was just a one day phenomenon. That’s why it will be important to watch how gold will react to price moves in the rupee against the dollar which we are likely to see in the not-too-distant future.

If you'd like to stay up-to-date with our latest free commentaries regarding gold, silver and related markets, please sign up today.

Thank you.

 

Nadia Simmons

Sunshine Profits‘ Contributing Author

Gold Trading Tools and Analysis - SunshineProfits.com

* * * * *

 

Disclaimer

All essays, research and information found above represent analyses and opinions of Nadia Simmons and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Nadia Simmons and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Nadia Simmons is not a Registered Securities Advisor. By reading Nadia Simmons’ reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Nadia Simmons, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in