Gold Continues to Catch the Attention of Traders!

By mercaforex

CAD/USD:
Giving the Greenback a run.

The Canadian Dollar has been stuck in a very wide range since late September. The upper outer level of support is 1.0881, while support has also been seen around 1.0750 (+/-). CAD resistance is just south of 1.0250. The longer a Forex pair trades the range the more the MA's will consolidate. As we mentioned yesterday, an extended period of consolidation acts as the primer to a strong break out in one direction or another. The CAD closed below its 50 day MA so it is possible we may see a 1.04 handle and if we do the next target level would be a test of lower resistance around 1.0250.

NZD/USD:
The kiwi is trapped.

The New Zealand Dollar is trading the Forex technicals perfectly. It bounced off of the 200 day MA which was acting as support for NZD. However, since the NZD is a commodity currency and commodities have been trading lower over the last few session due to risk aversion, the NZD appears to be stuck. The Kiwi it bumping up against resistance formed by the Fibonacci 23.6% Retrace level, generated from the Kiwi's high and low of 2009. The NZD would need to take out the 23.6% Fibonacci level followed by a break above the 50 day MA in order to resume its strength. If the Kiwi slips below its 200 day MA then it may signal more weakness to come. In addition, notice the current trend lines are downward sloping.

GOLD:
Making another rush for it.

The precious metal has been a real eye catcher and not simply because of its looks. You see the signs everywhere “we buy gold”. The price of Gold soared in 2009 only to loose nearly $200 an ounce from its 2009 high to its 2010 low. On this quiet trading day, Gold is attempting to break the psychological $1,100 which also will represent a close above its 100 day MA and just a hairs breath shy of the 50 day MA. Before taking on a bullish tone we would like to see Gold break its high above 1,150. This would be significant as it would break the current technical step pattern of lower highs and lower lows as indicated on the chart below.