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Gold holds $1900 : Is the bounce next?

Commentaries & Views

Gold is finding support at $1,900, as suggested was the probability yesterday morning. It is likely that a bounce to the $1,920 area will also materialize. However, should $1,895 break to the downside, $1,870 would quickly come into play.

The below chart shows the gold/silver ratio on the daily timeframe. A short-term bounce in metals would likely coincide with a consolidation in the ratio above the breakout line.

US indices are pointing to a relatively flat open today, after the bounce off the support line we indicated yesterday morning. However, it is likely that a very short-term consolidation pattern will form leading into next week’s FOMC meeting.

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