Swiss gold referendum - A bear trap ???

FX:XAUUSD   Gold Spot / U.S. Dollar
Gold ( 01 .12.2014) reverse from $1207 mark which we mention as first resistance for bulls. However fall from mention level should taken as correction or profit booking but swiss gold referendum added more fuel & created panic selling.

Now gold is trading around $1275 & we have witness a sharp bounce from recent low $1142 made just after a NO answer from swiss gold referendum. The bounce producing a major among trader that how actually this NO going to react. Here is the most possible answer.

Swiss gold referendum YES would force swiss banks to buy tonnes of gold to increase the gold holding from 8% to 20% but a NO answer is actually not going to change anything for gold normal trading. The panic selling come in first trading session was not supported by volume (see chart), while the NO answer avoided the immediate buying from swiss banks but now it is mandate for central bank to buy gold from open market or off market.

Coming to technical picture, gold made a low of $1142 & now trading above $1169 which represent the 61.8% fibonacci retracement of last upside move till $1207. A stability above this mark with volume & a very positive divergence on day chart suggest that gold already digested swiss result & a technical upside move will continue for coming trading session. A break above $1207 will provide more strength & we may witness a quick move towards $1247.

MCX GOLD traded lower with spot gold however the correction more deeper due to removal of 80:20 rule by indian government & low volume . Still on technical front gold was able sustain above previous low. This particular move forming a double bottom pattern which is well supported by positive divergence as shown in the chart. Channel resistance situated around 26780 & if this is broken we may witness a sharp move 26900 & more.

Swiss gold referendum could prove a big bear trap if above technical picture stay alive.
Best of luck

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I've calculated Gold projected target, based on my expectations for Silver to drop down to $9.
My gold target is $800.
Do not buy Gold and Silver untill a shortage develops. Shortage on Silver is now non-existent. I do not know about shortage status on Gold, but they are related in price. Dolllar has a long way to rise, including non-shortage condition.
Result is more downsite on the commodities.
OH REALLY !! then why don't you write some article with charts so more readers can get benefit......why writing comments on my section??
Patladj. mantracommodity
What is not clear on my comment? It is not the problem that I do not write it correctly, but it is the problem that you do not understand the words I speak.
I say: Do not buy Gold nor Silver untill a shortage develops
Patladj. mantracommodity
REgerding the swiss referendum, my opinion is the result was known a few weeks ago using surveys, price action had already happened. What happened the day the actual referendum results were out is some technical and less-informed bulls closed their long positions when they finally realized the cause is hopeless, and the double bottom which formed was a result of more technical bulls (some algo-trading) enteriing long on dip because of heavy bullish divergences forming serveral times in last 3 weeks. Problem is, I'll explain it not using charts this time, is that those bulls are limited of number and are all already in. they now sit and wait for further price action. No fundamental new buyers. That's why I predict the slow reverse and going southwards. Why do we always has to tech the charts (I do not deny the tech). Can we also try to explain the charts by imagining the market participants. After all the form because of them. If you expect from me to always comment charts, I will not. Sorry
HOO HOO HOOO KUCHI KUCHI KUCHI GOLD bear trap succeed ;)) What Next ????
Patladj. mantracommodity
This is not a bear trap. It is delayed reaction to referendum outcome + technical bulls chargin in on heavy bullish divergences last weeks. But Fundamentals points more downside of Gold and Silver. Silver will drop down to $9. Gold down to $800, that's why it will slowly turn down again and continue southwards. Other major argument of Gold and Silver more down is the non-existent shortage on those commodities. If it was the beginning of a bull trend, there would have been shortage like it was before.
kuchi kuchi kuchi o lo lo lo o lo lo lo.....sweet baby
+1 Reply
Patladj. mantracommodity
:) :) I like your reaction to my reply :)
Gold retested $1207 mark again as expected.
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