Forex Trading - Weekly Analysis

Forex Trading - Weekly Analysis. This week I'll be focusing on the Gold market. Gold gained an amazing 70% in this past year and climbed from the 420-440$ range gained 300$ and closed yesterday at 714$. The weekly close above another significant round number - 700$, may mean new highs for gold.

Gold technically doesn't belong in forex trading, but many forex brokers offer trading gold spot alongside forex trading. Plus this market is so hot now, that it couldn't slip my attention.

So what's driving gold up? Or maybe a better question would be - What's not driving gold up? Just to recap 2 of the most recent moves: China will probably increase it's reserves of gold by 3-4 times and moves in forex trading, the falling dollar of course. Looking back little further: The Iran Nuclear Crisis was the major force behind the recent rally in gold. In times of insecurity, investors use the precious metal as a safe heaven. Plus rising oil prices as a result of the dispute are having an impact on gold, it is seen as a good hedge against raising oil prices. The dispute is not being resolved, and that just adds fuel to the fire.

Forex trading - The dollar fall had it's share in gold's advance. The metal rallied even amid a strong usd, now that task is much easier. And finally let's not forget basic supply and demand forces. There's simply not enough gold in the world. Demand is expected to exceed supply by far this year. Here's a good site for gold news/analysis.

Now here's the chart, technicals favor gold. Just look at that rally. Still the CCI seems a little stagnant so I would be careful not to buy gold without some confirmation. Timing is just as important as direction. A retracement is possible, but even then it should be short-lived, and the uptrend should continue.

That's all for this forex trading - weekly analysis. Thanks for reading, feel free to leave a comment and bookmark this site, so you can come back often.