Gold may witness sharp moves: What could it be reflective of

A sharp uptrend or downtrend is in the offing for gold, technical analysts believe. The following are the possibilities:

Possibility 1: A case of uptrend in Gold may be the outcome of a global shock

The global economy is too fragile to withstand any further shocks. If an uptrend in gold occurs, it could be attributed to a shock that can shove the planet into yet another round of recession!

Possibility 2: A case of downtrend in Gold may be the outcome of QE3

With stocks and commodities falling, the global economy needs some stimulus. If the QE3 occurs, then that can Lead to a downtrend in gold unlike in previous two scenarios of QE (Quantitative Easing). Because, people who have invested in gold can book profits and re-direct the cash to other commodity assets which are now most attractive!

As published in: http://www.commodityonline.com/news/Gold-may-witness-sharp-moves-What-could-it-be-reflective-of-41510-3-1.html
Last Updated : 09 August 2011 at 18:00 IST