Commodity Trading Tips for Gold by KediaCommodity

Ajay Kumar Kedia 15 January 2014

Gold Gold settled down -0.4% at 29096 as a rally in U. S. equities that was sparked by encouraging December retail sales data dampened buying sentiment among bullion investors. Friday's non-farm payrolls showed that U. S. employers added jobs at a much slower pace than expected, sparking fears about the strength of economic recovery. Markets speculated that the weak report could prompt the Federal Reserve to proceed cautiously in tapering its historic monetary stimulus, causing equities and the dollar to drop. The Fed last month announced its first cut to its $85 billion monthly bond purchases citing an improving economy. Gold had rallied to all-time highs in 2011 due to these stimulus measures that had been expected to stoke inflation. In China, the biggest physical market for gold, demand has picked up since the beginning of the month in the build-up to the Lunar New Year, when the metal is bought for good fortune and given as gifts. The U. S. Commerce Department said that retail sales rose by a seasonally adjusted 0.2% last month, beating expectations for a 0.1% increase. Retail sales for November were revised down to a 0.4% gain from a previously reported increase of 0.7%.Rising retail sales over time correlate with stronger economic growth, while weaker sales signal a declining economy. Core retail sales, which exclude automobile sales, edged up 0.7% last month, above forecasts for a 0.4% increase. Core sales rose by 0.1% in November. Technically market is under long liquidation as market has witnessed drop in open interest by -1.06% to settled at 8548 while prices down -116 rupee, now Gold is getting support at 28980 and below same could see a test of 28864 level, And resistance is now likely to be seen at 29263, a move above could see prices testing 29430.