iiTRADER 1/20/16Wednesday January 20, 2016 09:44
The remainder of this week is ‘go-time’ for Gold. Equity markets have once again tanked overnight and the S&P took out the August front month lows at 1831. Gold has every reason to not only close out above first resistance at the 1095.6-1097.1 level but also the 1107.8-1108 level which aligns this year’s closing high with the 100 day moving average. Our next major three star level comes in at 1118-1119.2 and our upside target is 1136.5-1137.2. Treasury prices continue to edge higher and have left Gold in the dust, well, at least for now. With treasury yields at these levels, Gold absolutely must become attractive; to reemphasize, it is ‘go-time’. Furthermore, we continue to believe that the US Dollar Index will begin to stall at its current level of 99-100 as key economic data points come in short of expectations and headlines sway more towards the Fed easing than tightening. This morning CPI, Building Permits and Housing Starts are due at 7:30 am CT. The ECB Meeting tomorrow isn’t expected to bring fireworks but we believe calls for new stimulus measures in the future, along with easing from other central banks around the world will continue to support Gold.
Resistance –1101.6-1103.8*, 1107.8-1108**, 1118.9-1119.2***, 1136.5-1137.2***
Pivot - 1095.6-1097.1
Support – 1084.9-1085.2**, 1078.2-1079.3**, 1071.3**, 1060.2-1064.5**, 1056.50*, 1033.9-1045.2****, 995-1005**
By Bill Baruch