FxWirePro Longer term outlook: Extending Gold target 1670 area

We are the Gold bugs. We are the Gold bulls.

Gold seem to be benefiting from anything and everything. First it was the risk aversion that helped push Gold higher from $1050/troy ounce area, it also coincided with floor of a longer term downward sloping channel that has been in place since 2013.

Then Gold benefited from any uncertainties it can gets its hand onto. Now with equities rising and risk aversion fading it has started feeding over weaker Dollar. The day Dollar strengthens, it drops but starts feeding onto the fear from negative rates.

Considering the uncertainties ahead, Gold is likely to benefit further as asset managers start increasing share of gold in their portfolio.

Caution and trading idea:

In our previous post on Gold, we stated that we at FxWirePro fundamentals are gold bulls but yet to become Gold Super bulls. And that reason still stands -

• We remain gold bugs and we recommended to start buying @ 1090/troy ounce with initial target of $1140/troy ounce, then extending it to $1230/troy ounce. Both of these targets have been achieved. We remain quite positive that our next extended target of $1340-1350 area will be reached. Now we are extending that target further to $1670 area.

• The reason we aren't becoming super gold bull id that still one of our calculation matrix is pointing to a drop to $1000/troy ounce and beyond. Similarly US investment bank Goldman Sachs has called for $1000/troy ounce by year end. While we don't have a time target we have a stop loss for that scenario, which is around $1350 area.

So the takeaway is even if Gold is up for $1670 area, there could be large correction from $1350 area. We would prefer to re-entry given our bull status, nevertheless caution is recommended.

Gold is currently trading at $1260/troy ounce.

Kindly do not confuse this call from FxWirePro fundamental, with other short term and technical calls.