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Gold Could Find Sticky Resistance At $1,307

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Yesterday’s close: Settled at 1298.1, up 7.0

Fundamentals: Gold pushed through the psychological $1300 mark late in yesterday’s electronic session and carried this momentum into the overnight. Price action was edging higher after U.K’s Parliament confirmed the inevitable, that Prime Minister May’s Brexit deal will not get passed. Gold has been a key beneficiary this week as the looming March 29th deadline nears. Today, the U.K Parliament will vote on whether to leave the EU without a deal. A hard-Brexit is almost certain to slow growth, and this tied to the many other uncertainties brings a very favorable environment for the metal. Furthermore, inflation data from yesterday’s CPI and today’s PPI gives no reason for the Fed to question their patient approach to monetary policy, another favorable factor for Gold. However, with Durable Goods coming in solid, this may keep a lid on early gains for the time being.

Technicals: Although Gold is handedly out above what was first key resistance at 1298.1-1299.2, we say there may be a lid on early gains because major three-star resistance comes in at 1304.7-1307.2. Gold traded to an early session high of 1309.4 but do not underestimate the stickiness of this resistance level until we confirm close out above it. Support now comes in at 1298.1-1299.2 and a move back below there today will signal a near-term failure.

Bias: Bullish/Neutral

Resistance: 1298.1-1299.2**, 1304.7-1307.2***, 1315.3**, 1323.4-1326***

Support: 1291-1293.5**, 1273.2-1280***

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