Gold Market Laying the Bullish Groundwork
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Yesterday’s close: Settled at 1301.8, up 14.4
Fundamentals: Gold finally acted like a safe-haven and rallied as trade war shockwaves sent fear through risk-assets. The Dollar has pared losses from midsession yesterday and equity markets are attempting to stabilize, both have capped this rally in Gold. Traders also must keep a close eye on the Chinese Yuan which has lost as much as 1% against the Dollar this week but is also attempting to stabilize. Import and Export Price Index data came in weaker than expected. Kansas City Fed President George, a 2019 voting member, speaks at 11:45 am CT and San Francisco Fed President Daly speaks at 5:00 pm CT. Tonight, we get a deluge of China data; Industrial Production, Fixed Asset Investment, Unemployment and Retail Sales.
Technicals: Yesterday’s rip has fizzled-out a bit, but the bullish groundwork is in place. Price action broke out above a trend line from the February high and while out above 1291.3-1295, the path of least resistance is higher. We did get the close above 1301.5 yesterday that we said here was crucial, but we must continue to see a constructive landscape and a poor close today below 1291.3 will neutralize this strength.
Resistance: 1301.5**, 1308.5-1311.6**, 1318.3**
Support: 1291.3-1295***, 1279.1-1280.8**, 1264-1267.9***, 1255.8-1258.5***