INTERMEDIATE TERM TREND NEUTRAL
SHORT TERM TREND BEARISH
VERY SHORT TERM TREND NEUTRAL
In our last update we commented that, following the rally in the gold price after finding short term support at the 2017 down trend line at 1160, we suspected that the rebound had some legs left with 1220 a potential target level.
As it turned out, the rally did have a bit further to go, however gold didn’t quite make 1220, finding resistance at one of our other highlighted potential resistance levels of 1214 before turning lower again.
This is a bearish development, demonstrating the weakness inherent in the gold market at the moment and suggesting that a retest of support at 1182 now seems likely. A break below 1175 would suggest another test of 1160 and if this level were to fail, a return to the low 1100s would be likely in the short term.
At present, the price still remains well below all of the major moving averages, which are all pointed sharply lower. The 50 day Moving Average is currently at 1225 and will provide initial resistance, together with the 200 day Moving Average at 1290 and the 89 day Moving Average at 1256.
We have stated several times in our previous reports that support for equities remains strong and we expected new all time highs later this year. This week, the Dow has made yet another new all time highs, breaking above 26,000 for the first time, as has the S&P 500 hitting the 2,900 level for the first time ever.
The Dow is currently at 26,050, just below the new all time high of 26,167, with the S&P 500 currently at 2,907, just shy of the new all time high of 2,916 hit yesterday.
Oil is continuing to bounce hard after a correction to the recent strong rally and is currently trading around $70 a barrel.
Support can be found at 1195, 1182, 1172, 1160, 1145, 1122, 1100, 1072 and 1045. The recent sell off is bearish for gold in the long term timeframe and suggests a move towards the 2015 lows at 1045 is becoming more likely.
Short term resistance can be found at 1207, 1214, 1218, 1233, 1265, 1273, 1278, 1284, 1292, 1302 and 1310. Gold needs to break the key resistance level at 1360 to give the bulls some momentum and long term control.