Gold's Price Action Firming Up
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Yesterday’s close: Settled at 1291.1, down 8.2
Fundamentals: Despite yesterday’s weakness in the face of a very healthy risk-environment, Gold did not do anything wrong and is bouncing back firmly this morning. Ahead of a British Parliamentary Vote on Brexit today, hopes behind U.K Prime Minister May’s Brexit deal have quickly deteriorated, and this is favorable for Gold. If her deal is shot-down today, there will be a vote tomorrow on whether the U.K will leave the EU without a deal at all with the March 29th deadline looming. Also boosting Gold this morning was a softer than expected read on U.S CPI. This confirms the Fed’s ‘patient’ rhetoric and has allowed Treasuries, Gold and the Yen to all bounce this AM.
Technicals: As we noted here yesterday, Gold must hold first key support at 1291-1293.5 in order to remain near-term constructive and this was exactly the case with a low of 1290.6 and a settlement of 1291.1. The tape has firmed-up coming into this morning but first key resistance at 1298.1-1299.2 is still a headwind. We remain unequivocally bullish Gold and a move above major three-star resistance at 1304.7-1307.2 is immediate-term bullish for the tape.
Resistance: 1298.1-1299.2**, 1304.7-1307.2***, 1315.3**, 1323.4-1326***
Support: 1291-1293.5**, 1273.2-1280***