Gold May Advance to $1,350 in Three Weeks: Commerzbank Technical Analysis
Gold may rise to about $1,350 an ounce in three weeks after prices resumed gains to a record, according to technical analysis by Commerzbank AG.
The attached chart shows gold heading for $1,347.43 an ounce, a 261.8 percent Fibonacci extension of the February to March advance, Axel Rudolph, a technical strategist at Commerzbank in London, said. He referred to one of the levels used in so-called Fibonacci analysis. The price dropped 0.1 percent on Sept. 27, the first decline in a week, and has since climbed to a record.
“The correction was far shorter than I had anticipated,” Rudolph said yesterday. “We now target the Fibonacci extension at the $1,350 area.” As long as the price stays above this week’s low of $1,283.15 an ounce, gold prices will advance, he said.
Gold for immediate delivery climbed to an all-time high of $1,313.45 an ounce yesterday and is headed for a 10th annual gain as investors seek protection against financial turmoil in Europe and the prospect of slowing economic growth. It traded at $1,309.45 an ounce at 6:03 p.m. in London yesterda.
In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index. Fibonacci analysis is based on the theory that prices rise or fall by certain percentages after reaching a high or low.
To contact the reporter on the story: Anna Stablum in London at astablum@bloomberg.net.
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net.
Sept. 24 (Bloomberg) -- Abhay Deshpande, co-manager of the First Eagle Global Fund, talks about his investment strategy. Deshpande also discusses the outlook for gold prices and U.S. stocks. He talks with Matt Miller and Carol Massar on Bloomberg Television's "Street Smart." (Source: Bloomberg)
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