Gold prices still feeling the pressure
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Yesterday’s close: Settled at 1499.2, down 11.9
Fundamentals: The pressure on Gold continues as both Treasury yields and the Dollar elevate. The latest to fuel the pair higher is U.S Core PPI data this morning coming in stronger than expected. Still, tomorrow’s ECB interest rates decision and U.S CPI are the highlight of the week and as we have noted, what’s key is for Gold to hold a constructive fundamental and technical landscape ahead of these events. But furthermore, it must be understood that regardless of the landscape heading into it, the events still may not be favorable. However, holding construction will allow Gold to not battle with an arm tied behind its back through the events. For instance, a less dovish ECB which rallies the Euro can still help Gold on a currency basis if the landscape remains constructive ahead of such; see more in Technical section below.
Technicals: Yesterday was the lowest settlement in Gold since the August 7th surge. As we remain near-term cautious and long-term optimistic, our Bias has been more Neutral since trading below 1430. Still, yesterday’s settlement held major three-star support at 1498.6-1500. Below there is our line in the sand at 1484.5-1487.2. A close back above 1510.5-1511 will work to neutralize this wave of weakness, but a close back above 1520.4 is truly needed to secure such. Only a close back above 1529.1-1531.9 is bullish once again.
Resistance: 1510.7-1511.1**, 1520.4**, 1529.1-1531.9***, 1537.9*, 1546-1548.7**, 1565**, 1588.2***
Support: 1498.6-1500***, 1484.5-1487.2***