Midweek Report 30th October

Gold
Gold is trading circa the 1227 area since breaking through the 1214 resistance a few weeks ago. Recent reports have stated that not only is this a heavy work area from July (circled on chart), but also it is just below the 38.2 Fibonacci Retracement of the move down that began last April. This level comes in at 1238 and although Gold has marginally moved through here several times, it cannot sustain prices above this point. Last Friday, Gold managed a high of 1243 but was back down at 1233 for the close. So far this week there has been some moderate selling and in early trading today, looks to test the first support at 1223 however, even if this were breached, positivity remains above 1214. For Gold to look very good again it needs to close above 1238.

Currencies
GBP continues to lose ground against both USD and EUR after yesterday's budget. Although delivery was upbeat, observers believe it carries no weight with Brexit looming in March, when adjustments may be needed. Last Friday, Cable recovered from a low of 1.2776, just below that day’s support, to close back up at 1.2825. This was a highlight with a decent lower rejection shadow however, the sellers are back again this week and pressure continues to mount. Unless the Bulls can fight back today, then the next objective for the Bears is down at 1.2661, the low from 15th August.

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