FXstreet.com (Barcelona) - Ole Hansen, Head of Commodity
Strategy at Saxo Bank, sees potential to enter a long position in
XAUEUR at current levels, with initial stop at 1,237 (December
low), aiming for 1285, January high. The analyst adds that the
trade can be played as a combination of "buying XAUUSD and selling
EURUSD for an equivalent amount."
According to Mr. Hansen: "Gold continues to consolidate while the
euro looking overbought. The price of XAUUSD has spent the last few
days consolidating following the sell-off last week. We have so far
managed a couple of closes above the 200-day SMA, currently at
1662, which has become a point around which most of the action has
been seen during the last month. In order for gold to turn properly
bullish we need to see a technical break above 1710 USD/oz and
while we wait for that to happen eventually, some better
opportunities may be provided by the XAUEUR."
Ole notes the following risk: "EUR continues to rally while a
correction against the dollar carries the risk of dragging XAUUSD
lower which is why the stop is located just below the recent lows
as trend-line support from October 2011 would be broken."