The bulls will want to maintain their recent momentum and push throguh this critical level, thus setting up for gold for a sustained rally, whilst the bears will want to cap gold below the 50 DMA, thereby setting up a bearish "double top" at 1352-1353 on the charts. A break of the uptrend channel, currently at 1341, is the first level to watch for the bears.
The current area is therefore a key battleground for gold that will decide the direction over the next few weeks. Our preference remains to the downside, however the bulls are having a real go here in the face of a plummeting dollar.
Equities remain on fire, powering higher in a classic rally of higher highs and higher lows with no signs of a top in sight. Oil has found some support but is now trading below the 200 DMA for the first time since March, a worrying sign for the bulls and commodities in general.
Support can be found at 1328-1330, 1310, 1300-1305, 1291, 1277, 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 1352-1353, 1375, 1400 and 1434. A break above 1434 would suggest a major rally was unfolding with a target of 1525 as a minimum.
Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.