Gold (June)
Yesterday’s close: Settled at 1324, down 14.3
Fundamentals: Gold settled 2.2% off of last Wednesday’s close, losing significant ground to Dollar strength. While rising Treasury yields also pose a threat, we have seen just earlier this year that Gold can actually gain ground as yields rise on inflation hopes. Today though, Gold is seeing support as the 10-year traded to 2.998% yesterday and has backed off. The Dollar remains the most crucial part to the trade and the strength of the Dollar Index faces a critical three-star resistance level ahead of today’s data. Despite a poor read on German Ifo Business Sentiment the Dollar did not extend gains. We now look to Case Shiller House Price Index at 8:00 am CT and Consumer Confidence and New Home Sales at 9:00 am CT.
Technicals: Price action traded through key levels Friday and Monday but did hold support at 1322.4-1325.4. Traders want to be cautious as to whether or not today’s tape is a dead cat bounce. A close back above the 1331.9 will help the metal gain solid footing, however, the real level we must watch is 1337.1-1337.6 and only a close back above here will begin to neutralize this weakness. The 100-day moving average at 1325.2 and the 200-day moving average at 1311.3; these are crucial levels that we will lean on for our long-term bullish outlook.
Bias: Bullish/Neutral
Resistance: 1331.9**, 1337.1-1337.6**, 1345.7-1348.8**, 1356.7-1358.4**, 1367.8-1370***
Support: 1322.4-1325.4**, 1311.3-1316.6***
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