INTERMEDIATE TERM TREND: NEUTRAL
SHORT TERM TREND: BULLISH
VERY SHORT TERM TREND: BULLISH
Gold surged higher last Thursday, blasting through our target of 1206 and making a high at 1220 near the 50 DMA before retracing the entire rally over the next few trading sessions. The price bounced off the 20 DMA at 1178, forming a “doji” candlestick on the daily chart yesterday.
Today, after consolidating in a narrow band between 1180 and 1190, gold has surged higher again on the back of weak data from the US, hitting an intraday high of 1204. The next level of resistance comes in at 1206, being the 38.2% retracement of the decline from 1306 to 1142, with strong resistance coming in at 1220-1225.
Equities have corrected sharply over the last few trading sessions, with the S&P 70 points below the all-time highs at 2120. The dollar is also correcting after a parabolic rise above 100, whilst oil is tumbling again after a weak rally back above $50.
Support can be found at 1191, 1178-1182, 1168, 1160, 1143-1146, 1131, 1124, 1100, 1085, 1045, 1000, 950, 867 and 806. A break of 1131 would be very bearish for gold and suggest a return to 1000-1050 in the first instance.
Resistance can be found at 1204-1206, 1209, 1220-1223, 1252-1256, 1274, 1285, 1297 and 1305-1308. After a promising move higher following the break of 1180 last year, gold has failed to break the intermediate down trend and is now heading lower again, with the 2014 lows in sight.
Today's video for subscribers looks at the recent trading in more detail and our strategy for today's trading session.