Market Reviews of the Pervious Day:
During NY session on 27 May, dollar index tumbled on depressive economic data arousing woes among continuous loose monetary policy. Technical pattern matched with market sentiment. The continuity of downtrend of dollar index was under observation.
Gold ended in green on 27 May. Defensive demand arised on Greece financial crisis. Weakening greenback also favoured the commodity. Technical trend extended and upside oscillation continued.
Key Economic Data and Events:
U.S., U.K. Public Holiday
GMT+8 14:00 Germany Retail Sales (Apr)
GMT+8 20:30 Canada GDP (Mar)
Gold:
Gold opened at 1518.62 USD on 27 May, with intra-day Low at 1518.30 USD and intra-day High at 1538.35 USD, eventually closing at 1536.20 USD. Intra-day range of 20.05 USD was seen.
Gold ended in green on Friday and approached the upper of flag earlier than expected, closing almost the highest.
Although gold reached the resistance of the channel and was running at wave 5 , it was not recommended to buy the rally. At the moment no reversal momentum was seen and price stayed above the moving average. There was no signal that the current upside sideway pattern would change.
Uncertainties existed as pattern in long run and medium run diverged. Long-term strategy should dominate as long run uptrend remained.
While in the medium-short run the commodity was trading in wide range oscillation. Wide range should be located between 1460-1576 USD. There was room to go higher if the upper of range was broken.
Trading suggestions:
Investors should observe the overall sentiment, especially movement within wide range. Long positions may be suggested to place a trailing stop or limit order to lock in the profit. Small size selling is recommended if gold approaches stronger reversal momemtum when testing the potential resistance of flag.
Silver: closing in green, upside oscillation
Silver opened at 37.23 USD on 27 May, with intra-day Low at 37.16 USD and intra-day High at 38.19 USD, eventually closing at 37.97 USD. Intra-day range of 1.03 USD was seen.
Silver closed slightly higher on Friday, closing with a short bearish candlestick. Movement was restricted within the range of previous session while closing price stayed above the moving average.
Moving average tended to converge according to daily chart. The commodity was likely to test the level of 38.85 and 39.50 USD.
If the key resistance of 39.50 USD was breached price would approach to the level of 42 USD. Distribution of critical points should be awared.
Overall sideway correction pattern should take longer.
Trading suggestions:
Potential moving range has shifted upside to 32.40-39.50 USD and range trade strategy should continue. Investors should notice to trading size and dip buying is recommended.
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