Gold tumbled on Friday on rumours of progress in the US Government deadlock, with the dollar moving higher and equities rising as well.
The price broke through the critical 1272-1277 support zone with ease, triggering stop losses all the way down to a low of 1260. Gold recovered slightly into the close, though could not recapture the 1277 level.
This morning, gold remains weak and below 1277, even though the deadlock continues without end in sight in the US and equities fall back again. This is a worrying sign for the bulls, as gold remains entrenched in a solid down trend despite the apparently favourable back drop and looks set to fall back to 1180 eventually. Only a close above 1277 today or tomorrow would reduce the possibility of this outcome.
Support can be found at 1261, 1250, 1229, 1200 and 1180 - a break of 1180 would be an extremely bearish development, suggesting a target of 1000-1050 or possibly even 800.
Resistance can be found at 1292, 1300-1305, 1322, 1330, 1353, 1375, 1400 and 1434. A break of 1434 would be a bullish development and suggest gold was on its way back above 1500.
Today's video for subscribers looks at Friday's action in more detail and the implications of the recent trading.
The price broke through the critical 1272-1277 support zone with ease, triggering stop losses all the way down to a low of 1260. Gold recovered slightly into the close, though could not recapture the 1277 level.
This morning, gold remains weak and below 1277, even though the deadlock continues without end in sight in the US and equities fall back again. This is a worrying sign for the bulls, as gold remains entrenched in a solid down trend despite the apparently favourable back drop and looks set to fall back to 1180 eventually. Only a close above 1277 today or tomorrow would reduce the possibility of this outcome.
Support can be found at 1261, 1250, 1229, 1200 and 1180 - a break of 1180 would be an extremely bearish development, suggesting a target of 1000-1050 or possibly even 800.
Resistance can be found at 1292, 1300-1305, 1322, 1330, 1353, 1375, 1400 and 1434. A break of 1434 would be a bullish development and suggest gold was on its way back above 1500.
Today's video for subscribers looks at Friday's action in more detail and the implications of the recent trading.