This morning, gold is slightly lower in quiet trading, though is trading above the important 1277 level at around 1283.
Gold remains within the large triangle consolidation - we are watching for a breach of 1250 to confirm a downside break or alternatively a breach of 1350 to confirm an upside break and reversal in gold. Our preference is for a downside break and retest of 1180.
Importantly, the dollar has tested and held the 81 area, with this level now established as important near term support. Further dollar strength will translate into gold weakness as the inverse correlation between the two has been strong of late.
Equities remain at all time highs, with the S&P approaching 1800. We maintain our stance that gold will not sustain a meaningful rally unless or until equities correct in a substantial way.
Support can be found at 1277-1280, 1260, 1250, 1207 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 as a minimum.
Resistance can be found at 1291, 1295, 1300, 1310, 1320-1322, 1328-1330, 1338-1342, 1352-1355 and 1360. A break above 1360 would suggest a new bull trend was underway, though it would take a break of 1434 to confirm this was the case, with a target of 1525 as a minimum.
Today's video for subscribers takes a detailed look at the triangle consolidation and our strategy for our next trade.