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A Quick Summary of What Happened in Q2 2010 (A Rally Season):

Fundamentals that affected prices in Q2:

Fundamentals also supported gold price to stay on the uptrend momentum. Gold was seen as a safe haven, as European debts were causing serious concerns in the markets, US companies posted weak results, and Euro was trading weak against the USD. As investors were concerned with markets recovery, they turned to gold as an alternative investment. Thus giving gold price strong momentum to stay above 1200.

Technical that affected gold price in Q2:

Technicals were strong in Q2, price was on a continuous uptrend.

Gold broke above several key resistances: 1149, 1160, 1176, 1194, 1203, 1216, 1226, 1245, 1255, and reaching 1265.

Q2 Peak: USD1265
Q2 Low: USD1111.5
Q2 Main Trading Range: USD1176 – USD1240

NOW, Going into Forecast for Gold Trend in Q3 2010: (Technical Corrections Season)

Q3 2010 is expected to be a technical corrections period. After Q1 as the corrections period, Q2 was a rally period, and we expect Q3 to be entering a technical corrections period.

Looking at the 2010 Chart:

While we still remain bullish for gold price in 2010, we believe that Q3 2010 will see price entering a technical corrections season. As the long term chart above shows that historically, Q1 and Q3 are technical corrections seasons, and Q2 and Q4 are rally seasons for gold.

Q1 was a corrections period, after Dec 2009′s peak at 1226, gold price bottomed at 1043 in Feb 2010, a 14.9% correction. Q2 was rally period, low price was 1112.8 in April, and peaked at 1265 in June, a 13.66% increase.

For Q3, if gold sees a 10% correction from 1265, then we could expect price to be at bottom near 1140 price level.

Looking at the Daily Chart:

The corrections channel indicates prices have entered a technical corrections period. We forecast Q3 season will be trading mainly between 1160 – 1217.

Q3 has undergone a step-by-step correction. Since start of July 2010, gold price fell through key areas of: 1265 – 1255, then 1255 – 1240, 1240 – 1226, 1226 – 1217, 1217 – 1193, 1193 – 1180, 1180 – 1160.

Key support levels at 1150, then 1140.
Critical support at 1124.

Gold price shall be searching for a bottom price during July and August, and we could see range tradings between 1160 – 1180, the 1180 – 1200, and 1200 – 1217. 1226 is a key resistance in Q3.

We do not forecast gold to be re-entering the 1226 – 1240 area in July and August. And shall be trading at the 1140-1160 area, looking for strong support.

However, if gold fails to find support at 1140, then it could see further downside to test 1124 for support.

Important factor is, if gold price fails to stay above 1124, then we could see a collapse of the upward trend, and could go back to test 1000 key support price.

But, we remain bullish for gold price in 2010, and expect this correction to be bottomed at 1124 – 1140. Then prices shall be climbing back up step-by-step, and preparing for another rally in Q4.

Key support areas in Q3: 1160 – 1180, 1140-1160,

If gold fails to find support at 1140, then next key support area is 1124 – 1140.

Critical horizontal support in Q3 is 1140, the 1124.

Caution: if gold fails to find support at 1124, then it could see aggressive selling pressure bring prices down to 1000 – 1100 area. This could lead to a collapse of the upward trend for gold price in 2010.

Key resistance areas in Q3: 1217 – 1226, 1226 – 1240, then 1240 – 1255.

Fundamentals have little impact on gold in Q3 in July 2010. Unlike in Q2, when fundamentals supported prices to see upward momentum. However, in Q3 technicals shall be playing key impacts on gold. When selling pressure is strong in a corrections period, even when we see strong fundamentals that would normally support prices to go up; this will not necessarily be the case in Q3.

We expect gold price would get back into a rally in 2010 Q4, and would break above USD1265 (historical peak)

In a world where our natural resources are quickly being depleted, experts and people from all walks of life are scrambling to find a way to conserve what little we have. However, in some industries the depletion of natural resources continues because it’s good for business. One such industry is that of gold mining. As long as nobody stops them, the mining companies will continue to do what they do best – mine gold, and in the process, destroy, land, water, and livelihoods.

A good way to stop the gold mining is to sell old gold, thereby recycling precious metals. But this cannot happen until there is more awareness of the detriments of gold mining. For just a small ring, there is a multitude of damage wrought on our world. In order to mine gold, mines are blasted deep into the earth, leaving acres of wasteland in its wake. Because there is a lot less gold left in the world than in past years, chemicals must be used to extract the tiny particles of gold from the mud and dirt. A cyanide solution is used to do this, and cyanide can be toxic at certain exposures to fish, plants, and even humans. Many companies dump their waste into nearby rivers to cut back on costs. Over time, this leads to the extinction of many existing ecosystems.

There have also been recent alarming spills of the cyanide wastes. Villages in Romania, Montana’s Rocky Mountains, and Alaska’s Bristol Bay Watershed are some of the places where gold mining has taken a devastating toll. The damage from some of these spills was so great that it will take years for the environment to recover, and even then, it may never be the same. In Baia Mare, Romania, one of the greatest disasters as a result of gold mining took place. In 2000 a pipeline carrying mining wastes exploded, sending the rancid chemicals pouring down on the village below. The area is today a shadow of the bustling village it once was. Many of the children are sickly from the chemicals that still permeate the surroundings, including the drinking water.

The only solution is to start recycling gold. The gold that is sold is melted down to be reused in new pieces, effectively reducing the demand for more mining. Getting cash for gold can be done by anyone. Everyone has old gold lying around. This can be in the form of gold coin collections, old gold jewelry, tangled chains, pairless earrings, and old heirlooms. Major mine watchdogs and eco-friendly organizations are advocating that people sell old gold to help reduce the amount of detrimental gold mining.

The process is fast and easy. Gold sellers can sell their useless valuables to pawnshops, jewelers, or online gold buyers. All will pay cash for gold, leaving the seller with bonus cash, and the environment with a little bit of relief. The relief is long in coming, and there is no absolute answer to conserve our environment, and the gold buried beneath the earth’s surface. However, getting cash for gold is a great place to start.

Some of the greatest marketing stories ever told are found in the jewelry industry. Until the internet came along, jewelry stores have done a good job of keeping their secrets under lock and key. Never before in the history of the industry have people had so much access to information–information that could be damning and crippling to the diamond jewelry stores.

Whether someone is getting engaged, looking to upgrade their wedding ring set, or seeking an anniversary ring, the process can be complicated and confusing to most people. One of most interesting things about the jewelry industry is that they have been so successful with creating a “need” for diamonds–their very own product in which bottom line is to see how much of a markup they can get away with before the consumer balks. It is amazing when diamonds are have been reported to be purchased for around $20 per carat by DeBeers in the African diamond mines. The labor is cheap (if not free due to family slavery) and DeBeers controls how much they sell them to other diamond companies. Not only is the labor cheap, so are diamonds themselves. Even Nicholas Oppenheimer, the chairman of DeBeers, has secretly admitted that diamonds do not have substantial value. Yet his cartel and mafia still boldly advise gullible men that it is desirable to spend two months’ salary on an engagement ring. It is fascinating from a marketing standpoint to have an item that women think they must have and are willing to pay thousands and even tens of thousands for when the cost for the seller is about the same as a few buckets of Kentucky Fried Chicken. This is the finest scam in all of consumer history.

So what is a person to do? Here are four suggestions before buying an engagement or anniversary ring:

1. Buy online. Nowadays, there are so many options out there that you need not venture into a store with high pressured salesmen, crooked “warranties” and markups averaging 600%. Let her go have fun trying rings on at the store, and then find the exact same one online.

2. Look at diamond alternatives such as opals, sapphires, eco diamonds, rubies, high-grade cubic zirconia or the new Swarovski diamond-cut stones that look identical to diamonds. Fantastic diamond alternatives of every shape and size are flooding the market and it will soon be difficult for anyone to know who has real and who saved a fortune.

3. Don’t be afraid to suggest alternatives to shopping and stones to your significant other. Chances are, she may be more open to something synthetic over a mined diamond. Probably even more than you realize. Let her know that she can get the best setting and a more expensive metal if she goes with something other than a diamond. It’s the setting that makes or breaks the ring.

4. Finally, if there is an heirloom diamond in the family on either side, use this instead of a new diamond. It means a lot more and you will not have to buy into the diamond scam.