A new feature to the Trader’s Blog will be the addition of the Chart of the week. Each week Longleaftrading.com will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.

June Gold has been incrementally moved lower since late February. The selloff began after the market failed to break above $1800 and at the same time, investors learned that the US FED planned to participate less in easing our economy. What began as a very sharp drop in the precious metal, then turned into a relatively rangy trade. Traders know that seasonally Gold tends to be a rangy summer market, followed by anticipatory purchases ahead of India’s wedding season. It will be important to watch whether India’s government will impose a tax hike to offset their trade deficit this year, and more importantly traders will continue to watch for any improvements in Europe or hints of easing from the US FED.

Technically, Gold traders are well aware of the narrowing range in the Gold market identified by the red arrows. A firm breakout above or below these trendlines would likely attract more volume to the market to speculate on a direction. [Read more...]