Precious pack is worst performer this week so far among the metals and Gold lost its shine on Monday as prices drop below $1100/ troy ounce for first time in 5 years.
Our call was to go short in Gold at $1163, with target of $1100 and stop around $1200. The target was reached this week.
So what to do in Gold now?
- Trade gold with bearish bias as of now, as long as resistance at $1120-$1125 holds. As of now small position is recommended, since next target is not very clear. Though bias is bearish it is not very strong yet.
- We are also warming up to the prospect of buying gold, as $1000/ troy ounce level is expected to be a tough nut to crack. However buying is recommended not yet but as close of $1000.
- While $1125 is likely to act as resistance, the bulls will find it difficult to push beyond $1050 area, without any major correction.
Gold is currently trading at $1108/troy ounce.
