GbP uP, GoLD tO CorrecT BeforE DowN - ApR 05

US Dollar getting big boost after Fed minutes, which gave clean chit to the US economy that the economy does not require easing condition and QE money due to stable economic condition helpingUSD to continue its upward journey, as signs from Europe is not very encouraging.

I always say that Europe has such a long list of problems that it is unending and will continue to pop up. This one of the major factor that despite temporary settlement of Greece issues, IMF making commitment for more money and increase in the size of firewall, investors are never keen to buy the European currency for portfolio investment knowing that the problem persist.

This time it was Spanish bond auction that made market nervous as bond auction failed to attract buyers fearing sovereign debt crisis is yet not over. Spain has a huge task of implementing promised austerity measure by imposing more taxes and slash spending to reduce its deficit. The country is already suffering with almost 24 pct unemployment, which is one of the highest in the modern world.

The impact of European worry is severe. Spain’s 10-year bond yields jumped to 5.71 pct, Euro is under pressure, world stock market fell. USD gained, SFR strengthen versus Euro, US treasuries recovered. Cost of Credit Default swap (CDS) in Asia has surged. But more surprisingly GOLD, which considered as safe asset could not find buyers and instead was severely clobbered.

Indian protest entering 18-day is a big cause of worry, as India is the biggest buyer of physical gold. Feds decision to stay away from further easing gave big blow to the gold speculators and the only hope to lend small support to the yellow metal is China easing. If China does not go for another monetary easing and Indian bullion and jewelry protest remains unsettled issue, gold could further plunge. Though China easing is early to talk, but this is good enough to keep investors/speculators at bay.

Euro @= 1.3146 = I do expect small correction and Euro should hold 1.3110 in Asia , but would prefer selling the European once it reaches1.3180-90 zones, which is possible only on break of 1.3260 for a drop to re-test 1.3120-25 later in day. 1.3250 will hard to crack.

GBP @ = 1.5901 = Cable should be good for 40-50 pips around 1.5870-80, as likely to hold 1.5840, for 1.5920, break here would encourage for 1.5945-50.

GOLD @ = $ 1623.40 = In Asia Gold has support around $ 1618, it could make small gain towards $ 1628 zones, I will sell on rise around those levels, as bearish spell is not over as yet. But will find support around $ 1615. On the up Gold should find resistance around $ 1636.

PrefeR LonG GbP & ShorT GoLD – ApR 04

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2 members like this

Comment by yasir kidwai on April 5, 2012 at 6:12pm: Hi Mr.Asad for the last two days i am just following your signal,and i am very Glad after a long time now i am again making some points because of you. Thanks a lot.

Comment by asad rizvi on April 5, 2012 at 6:20pm: Yasir, I am glad that I am of some help to you. I know that lot of traders are taking advantage of my post, but they feel shy to speak up except for few of them. By telling the truth they help other traders to know the fact. I don't mind if they make loss on my post I would like to hear from them....Best

Comment by Vinod Perkash on April 5, 2012 at 6:25pm: sir rizvi what u say about gold for now as tomoroow is a holiday and a big data is coming up of US.. shall we go for short at this level!!

Comment by asad rizvi on April 5, 2012 at 6:28pm: Vinod, GOLD @ $1629 = Next week Top $ 1640 - Bottom $ 1580...GL

Comment by Mohamad on April 5, 2012 at 6:31pm: Mr. Rizvi .. you have an average of 1800 views a day

Everybody on this site is following

I think the Fed's, ECB, BOE & RBA are following :)

Comment by Vinod Perkash on April 5, 2012 at 6:31pm: sir i hav shorted gold at 1618 level and den at 1633 .. made some profits but still my 1618 position is in loss.. dat was my mistake didnt followed u.. but now suggest me whether market will give dat level again!!

Comment by Vinod Perkash on April 5, 2012 at 6:36pm: thnku sir..

Comment by asad rizvi on April 5, 2012 at 6:38pm: Mohamad, this is too much. I am a very very ordinary person...Thank you for your support

Comment by asad rizvi on April 5, 2012 at 6:50pm: Vinod.. This is greed. I am wondering that today Gold tested $ 1622 levels 4-time. You are still waiting for profit. In trading you do not end in profit in all the deals. You need to disciplline yourself or else your equity could wiped of in no time.......Best

Comment by Vinod Perkash on April 6, 2012 at 11:36am: ya dat was my mistake today i realized it sir.. will try to avoid these mistakes again.. sorry and thnx 4 ur advice..

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