Gold Will Rise As the Dollar Falls
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
Last week’s close: Settled at 1349.9, up 37.6 on the week
Fundamentals: Today is April options expiration and more volume is in April, but the open interest has shifted. April is ok to trade, but longer-term must begin using June. What is there not to like about Gold right now as the Dollar loses ground after yet another Fed rate hike. The metal is holding well this morning despite U.S-China trade war fears dissipating. Still, there is nothing concrete and regardless, there are many other uncertain geopolitical aspects at the moment; everything from North Korea and Russia to the Middle East. We hammered home, once again, our bearish Dollar thesis in yesterday’s Tradable Events this Week and how we believe Gold will be a key beneficiary. You can watch our interview with Kitco Friday here: Why Gold Is Immune To The Rising Interest Rates. There is a lot of data to keep an eye on in this short week but not much today. NY Fed President Dudley, a hawk, speaks at 11:30 am CT. The 2-year auction is at noon today and the first in a string this week. Cleveland Fed President Mester speaks at 3:30 pm CT and Fed Governor Quarles speaks at 6:10 pm CT.
Technicals: While we remain unequivocally long-term Bullish in Bias Gold, we have Neutralized just the slightest bit today. This is due to April options expiration which aligned with strong trend line resistance at 1351.3-1353 and coupled with a stable equity market should keep Gold in check through the session. First support comes in as close as 1340.7-1342.9 while strong support also comes in just below at 1334.2-1336.9; both spots would present tremendous buy opportunities this week.
Resistance: 1351.3-1355**, 1367.8-1370***
Support: 1340.7-1342.9**, 1334.2-1336.9**, 1328.9**, 1323.6-1324.6*, 1303.6-1308***, 1298.7****