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A Defining Moment For Gold And USD

Commentaries & Views

Last week’s close: Settled at 1327.3, down 2.7 on Thursday and down 22.6 on the week

Fundamentals: Gold is off to a strong start this week as trade tensions between the U.S and China come to a forefront. While the White House is set to announce tariffs on Chinese imports focusing on intellectual property of technology this week, in retaliation to the steel and aluminum tariffs, China released a list of 128 U.S items it has begun to tariff. This adds to a jam-packed economic calendar that’s main focus will be Nonfarm Payroll Friday; we discuss this in last night’s Tradable Events this Week. The Dollar is weaker on the trade war discussion but also as it pares gains ahead of this week’s data; we remain long-term bearish the Dollar and this week can be a defining moment in reinvigorating the downtrend. ISM Manufacturing data is due at 9:00 am CT and we look to Minneapolis Fed President Kashkari and know dove to speak at 5:00 pm CT.

Technicals: Gold’s strong start is already facing its first technical hurdle, this is key resistance at 1339.6. A close above here today is crucial as this is needed to break last week’s wave of weakness and help the bulls regain the immediate-term upper hand. To the downside, Gold must hold 1327.3-1331.8 support in order to remain extremely constructive in the intermediate term.

Bias: Bullish/Neutral

Resistance: 1339.6**, 1344-1345**, 1367.8-1370***, 1375.5**, 1392.6**, 1427.2***

Support: 1327.3-1331.8**, 1312.4-1316.6***, 1304.6***

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