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U.S. Dollar Continues To Steal Gold’s Luster

Commentaries & Views

Last week’s close: Settled at 1206.7, up 1.6 on Friday and down 6.6 on the week

Fundamentals: The Dollar is higher this morning as it once again has stolen the safe-haven show. Gold is clearly subdued but battling at the psychological $1200 mark and holding much better than Silver which has shed more than 2%. The Chinese Yuan is only slightly weaker from Friday’s close but has lost ground from where it was over holiday hours. Overall, with a slew of data on the calendar this week, U.S economic data will play a key role in the currency trade and thus the Gold trade. Today we look to Manufacturing PMI at 8:45 am CT, ISM Manufacturing at 9:00 am and Chicago Fed President Evans at 9:30 am.

Technicals: Gold is below major three-star support at 1204 and this places the bears back into the driver’s seat. However, a shallow drop that can hold ground against our next major three-star level at 1187.6-1189.5 could actually prove to be constructive. Today’s close will be pivotal for the technical landscape. With the tape below 1204, we are now forced to begin Neutralizing our immediate-term bias.

Bias: Neutral/Bullish

Resistance: 1210.7*, 1214.9**, 1227-1228.5**, 1235.6**, 1244.6-1251.6***

Pivot: 1204***

Support: 1193.9**, 1187.6-1189.5***, 1178.5-1179.8**, 1167.1***

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