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Gold Needs To Hold Current Levels

Commentaries & Views

Last week’s close: Settled at 1255.8, down 3.0 on Friday and up 1.3 on the week.

Fundamentals: Gold is off to a strong start this week trading up about $10, although it did not respond to soft wage growth on Friday’s jobs report. The Chinese Yuan is down 0.4% to the U.S Dollar today and this is a constant reminder that the Yuan is driving Gold demand right here, right now. The Dollar is also losing ground to the Euro which is at the highest level since the June 14th ECB Meeting when Gold was above $1300. While there is no major economic data from the U.S today, Eurozone Sentiment data beat expectations and ECB President Mario Draghi speaks at 8:00 am CT and again at 10:00 am CT. Minneapolis Fed President Kashkari speaks at 8:15 am CT. We encourage you to read our Tradable Events this Week to see what catalysts lie ahead for the metal.

Technicals: Gold has moved out above first key resistance at 1262.5 and it will be crucial to hold this level on a closing basis to ensure this momentum stays intact. Second key resistance at 1267.4 is posing a hurdle and we want to see a test to major three-star resistance at 1274.4-1275.9 at minimum this week. There is a trend line from the April 11th high that is falling sharply and today comes in around 1290 and between two of our levels, we will be watching this closely on sharp rips.

Bias: Bullish/Neutral

Resistance: 1267.4**, 1274.4-1275.9***, 1284.7-1287.7**, 1295.8***, 1305.5-1313***
Pivot: 1262.5
Support: 1253.7-1255.7**, 1238.3-1241.7****

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