Gold Bulls Need To Protect Themselves
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Yesterday’s close: Settled at 1295.2, up 1.9 on Friday and down 0.4 on the week
Fundamentals: The price of Gold is withering away despite U.S Dollar weakness Friday and another lower session so far today. Upbeat comments from the IMF that growth will “firm up” and broad strength in risk-assets have deterred the need for safe-haven buying. Treasury prices followed losses Thursday by diving to new swing lows on Friday and the uptick in yields has clearly outweighed Dollar weakness. Price action shook off a miss on fresh April Michigan Consumer data Friday and now we look to fresh April NY Empire State Manufacturing at 7:30 am CT today and comments from two 2019 Fed voters. Chicago Fed President Evans is first at noon CT and Boston Fed President Rosengren is this evening at 7:00 pm CT. Although we were upbeat against major three-star support on Friday, we refrained from turning more Bullish in Bias until Gold can show us some technical construction; discussed below.
Technicals: Gold did not show us that technical construction Friday and could not settle out above first key resistance at 1299.8. Price action has now taken out first key support but do not forget our longer-term major three-star support sits at 1280.8-1287.5. This is at least the third major test into here and traders who are buying into here must, must, must manage risk and protect their downside. We are again outright Neutral until Gold can show us construction.
Resistance: 1299.8**, 1306.4**, 1312-1314.7***, 1320.5**, 1330.3**
Support: 1291.9**, 1280.8-1287.5***