Gold for Tuesday, March 24, 2015
Throughout last week gold has shown some life and reversed by moving strongly off the support at $1150 up to a two week high near $1190 where it is presently consolidating and trading around. It now has its eyes firmly on the key $1200 level however selling pressure from this level is likely and is probably already being felt. Prior to the recent move, gold remained quite steady enjoying strong support from the $1150 level whilst some eyes would have been looking lower. The next obvious technical support level lower is around $1130, and if it was to move through this level, then it would be trading at multi-year lows and looking very bearish. When gold broke through the rock solid support level at $1200 recently, it opened itself up to some potential downside which has been played out in the last week or so. Throughout the second half of February gold enjoyed rock solid support from the key $1200 level which held it up on numerous occasions. For about a month gold drifted steadily lower down to a one month low near the key $1200 level before finding the solid support at this key level.
Gold has now undone all of its great work from earlier in the year which saw it surge to a five month high near $1308, before reversing and moving back to $1150. At the beginning of December gold eased lower away from the resistance level at $1240 yet again back down to below $1200. During the second half of November gold made repeated runs at the resistance level at $1200 failing every time, before finally breaking through strongly. Throughout the first half of November Gold enjoyed a strong resurgence back to the key $1200 level where it has met stiff resistance up until recently.
Throughout the second half of October gold fell very strongly and resumed the medium term down trend falling from above $1250 back down through the key $1240 level, down below $1200 to a multi year low near $1130. It spent a few days consolidating around $1160 after the strong fall which has allowed it to rally higher in the last couple of weeks. Earlier in October Gold ran into the previous key level at $1240, however it also managed to surge higher to a five week high at $1255. In late August Gold enjoyed a resurgence as it moved strongly higher off the support level at $1275, however it then ran into resistance at $1290. In the week prior, Gold had been falling lower back towards the medium term support level at $1290 however to finish out last week it fell sharply down to the previous key level at $1275.
Gold closed higher on Monday as a weaker dollar and caution from the Federal Reserve on the timing of a possible hike in U.S. interest rates generated modest investor interest. U.S. gold futures for April delivery settled up $3.10, at $1,187.70 an ounce. Spot gold was up 0.5 percent at $1,188 an ounce, its highest since March 6. European shares fell, also on caution about whether Greece can reach agreement with creditors to secure fresh funds ahead of a meeting between its prime minister and Germany’s Angela Merkel. Gold is usually seen as an insurance against risk in times of financial or economic troubles when equities underperform. The dollar was down 0.8 percent against a basket of leading currencies. It came under pressure after the Fed’s cautious stance on the health of economic recovery in the United States. Market players’ consensus expectation for a U.S. interest rate increase has shifted, with most of Wall Street’s top banks now expecting the central bank to hold off until at least September, a Reuters poll showed.
Gold March 24 at 00:10 GMT 1189.7 H: 1191.7 L: 1179.4
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1150 | — | — | 1200 | 1240 | 1300 |
During the early hours of the Asian trading session on Tuesday, Gold is rallying a little higher with eyes on the key $1200 level. Current range: trading right below $1200 around $1190.
Further levels in both directions:
• Below: 1150.
• Above: 1200, 1240 and 1300.
OANDA’s Open Position Ratios
(Shows the ratio of long vs. short positions held for Gold among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The long position ratio for Gold has moved back below 70% as it rallied and steadied around $1190. The trader sentiment is in favour of long positions.
Economic Releases
- 23:50 (Mon) JP CSPI (Feb)
- 09:00 EU Flash Composite PMI (Mar)
- 09:00 EU Flash Manufacturing PMI (Mar)
- 09:00 EU Flash Services PMI (Mar)
- 09:30 UK CPI (Feb)
- 09:30 UK Input & Output Prices (unadj.) (Feb)
- 09:30 UK ONS House Prices (Jan)
- 12:30 US CPI (Feb)
- 13:00 US FHFA House Price Index (Jan)
- 13:45 US Flash Manufacturing PMI (Mar)
- 14:00 US New Home Sales (Feb)