Not long ago the Financial Times published an article by Robert Bruce Zoellick, President of the World Bank, who gave his voice for getting back to the Gold Standard.
It is not the first time we have heard such statements. However, there is a reasonable question of how it can be done if gold is not enough to secure the entire global financial system. Yet, it was the lack of gold that was the main reason for canceling the Gold Standard.
Numerous experts share the same opinion that over the mid and long term gold will continue gaining in value. So in the short run we may witness $1500 per troy ounce. There are even more brave forecasts. For example, some COMEX investors expect gold to have reached $2000 per ounce by November 2010.
In the meantime, the gold price has already come out of the MF sloping channel, terminated a Weekly wave (1156,7-1429,8) and made a correction to 38%. At the moment gold is retracing against last week’s downtrend. If the high is broken through, gold will regain its mid/long-term uptrend. If the price gets over the MF pivot at 1341.0 and resistance at 1339.5 (last week’s low) there will be a D1 FZR* testifying to the continuation of the downward tendency.
Resistance levels:
1424,6 – W1 FZR
1413,4 – 88%+ pivot
1402,2 – 76%
1388,4 – 62%
1383,1 – 161% Н4
1377,2 – 50%+138%
1364.2 – the current price
If there is a downward FZR (a breakout of 1329,7)
Support levels:
1322,1 – 38% W1
1307,3 – 123% D1
1290,6 – 138% D1 + 50% W1
1271,0 - 161% D1
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