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Gold Cracks Big Support

Published 04/24/2014, 10:21 AM
Updated 07/09/2023, 06:31 AM

Talking Points

  • Low volatility suggests important break looming in the Yen
  • GBP/USD stalls below key Gann resistance
  • GOLD turn window eyed next week

Foreign Exchange Price & Time at a Glance:

USD/JPY

Charts Created using Marketscope – Prepared by Kristian Kerr

  • USD/JPY has found resistance over the past couple of days near the 2nd square root realtionship of the year’s low in the 102.75 area
  • Our near-term trend bias is negative in the exchange rate while under 103.10
  • The 4th square root realtionship of the year’s high at 101.35 is major support that needs to be breached on the downside to set up a more important decline
  • Another minor cycle turn window is seen early next week
  • Only a move over 103.10 would turn us positive on the dollar

USD/JPY Strategy: Like the short side while below 103.10.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/JPY

*101.35

102.05

102.45

102.75

*103.10

GBP/USD

Charts Created using Marketscope – Prepared by Kristian Kerr

  • GBP/USD has stalled over the past week just below the 17th square root relationship of last year’s low in the 1.6850 area
  • Our near-term trend bias is higher while above 1.6710
  • The 1.6850 level needs to be overcome to confirm the start of a new leg higher in Cable
  • A very minor cycle turn window is eyed early next week
  • A daily close under 1.6710 would turn us negative on the Pound

GBP/USD Strategy: Like the long side while over 1.6810.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

GBP/USD

1.6655

*1.6710

1.6790

1.6800

*1.6850

Focus Chart of the Day: Gold

Gold

Gold broke under the 1277 1x1 Gann angle line of last year’s low earlier today. A daily close below this level will be especially negative for the metal in the short-term and open the door to further weakness into next week’s key cycle turn window. Key attractions on the downside into this timeframe look to be a Fibonacci confluence near 1260/63 and a convergence of several square root relationships and Gann angles in the 1244/47 area. We would urge caution against getting too negative on the metal as the middle of next should see at least an attempt to turn higher if not a full on reversal. Only unexpected aggressive strength over 1300 would signal XAU/USD has turned earlier than expected.

--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

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