Sydney, Oct 30: The Australian Gold Index has traded slowly higher within a wedge formation and is now showing indecisive chart patterns. These include a reverse flag, wedge, a spinning top, and possibly a pivot point reversal if resistance at 1,175 holds. Traders are likely to use the 1,115/1,195 range, but will focus on lower levels if the index fails to rally above 1,175 or falls below 1,150.Short term technicals are mixed and losing momentum. Averages are lacklustre with the 10 and 40-day numbers higher, but with the 20-day number sidelined. Leading indicators are also mixed. The ROC and stochastics are higher, but momentum is low, while the RSI is sidelined. Lower Fibonacci levels are 1,163, 1,131, already reached, and 1,098.
Medium term, the index is sidelined and indecisive within a two week old inside range at 1,104/1,270. It is barely higher than last week, but is forming a possible bullish flag with higher breakout at 1,215. Lower support is at 1,130. However, traders are likely to wait forconfirmation.
Medium term technicals are mixed and losing momentum. Averages are rising but on diminishing momentum. Leading indicators are sidelined. Stochastics are lower and below 80. They are currently at 78/77 and almost crossing, but cautious traders will wait for the cross. Elliot Wavers are seeing this as a Wave-Two correction of the Wave-One rally to 1,270. Fibonacci retracements are 1,093, 1,038 and 983.
Longer term, the index has withdrawn from resistance at 1,330/1,335 and extended the low. Traders will use the 1,080/1,235 range and 1,160 as a pivot point. They are likely to buy again if the index rises above 1,235. However, the index has made significant gains over the last two months and some retracement can be expected.
Longer term technicals are mixed. Averages are bearish, but the 10-month number is now sidelined. Leading indicators are mixed. The ROC is lower, while the RSI is sidelined. Stochastics are rising but are losing momentum and becoming sidelined.
The index has maintainedsupport at 1,110 and moved sideways to higher within a potential short term bearish reverse flag/wedge and medium flag pole formation.
Leading indicators are losing momentum and lacking in directional reliability. Traders are likely to use the short term range of 1,115/1,195 and medium term range of 1,104/1,270 and the wedges. Short term bearish wedge levels are 1,150/1,165.
The index is mixed and traders will most likely wait for additional confirmation before committing more resources.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
Printer-friendly page
