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GOLD – Safe Heavens are Being Bought

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A lot of bad news came from Cyprus today. At 16:00 GMT the deliberation started in the Parliament regarding the bank levy. The local reports suggest that none of the parties will vote in favor of this measure. The Finance Minister seems to have been forced to quit, but the resignation was not yet accepted.

For the moment the investors are looking for safe heavens. The dollar, the yen and the gold are being bought along with the 10 and 2 year German bonds and 10 year treasury notes from the US.

The market seems to have priced the bad news, but still could be dangerous for the risk assets, like Euro, to be bought. EURUSD is testing the 200 moving average and is getting pretty close to the 1.27  key support. EURJPY is getting closer to 119.75, under this level we can say that a Double Top pattern is to be confirmed and its target is at 113 yens per euro.

Even though the dollar is getting stronger, gold is not backing down. It has cracked 1600 and now it finds itself near to 1620 resistance. A close over this level would confirm the Double Bottom formation and we can look for a retest on 1680.

GOLD – Safe Heavens are Being Bought by