Gold for Thursday, February 26, 2015
For the last month now gold has drifted steadily lower down to a one month low near the key $1200 level before finding solid support at this key level over the last week. A few days ago saw gold move back and forth and tease the $1200 level a little however the demand kicked in and brought it right back above the key $1200 level before moving a little higher in the last 24 hours. A couple of weeks ago it rallied higher after dropping through $1220 before running into some resistance around the key $1240 level. The last month or so has now undone some great work earlier in the year which saw it surge to a five month high near $1308, before reversing and moving back to $1200. It presently finds itself trading in a narrow range right around $1200 where it is experiencing solid support. A few weeks ago gold eased back a little and steadied below the $1280 level after surging to that area and a four month high, before its recent strong surge higher.
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 rose on Wednesday, recovering from the previous day’s seven-week low, after Federal Reserve Chair Janet Yellen suggested the central bank was in no rush to raise interest rates. Her comments weighed on the dollar, supporting gold. Spot gold was at $1,203, up 0.3 percent, after hitting a peak of $1,211.80 an ounce. U.S. gold futures for April delivery were up $5.50 an ounce at $1,203. Yellen held back on Tuesday from giving a clear view on when the Fed will begin raising rates. The ensuing rally in precious metals on Wednesday pushed silver up more than 3 percent and palladium to a six-week high. Yellen said that while the Fed is preparing to consider rate hikes on a “meeting-by-meeting basis”, an increase is not likely for at least the next couple of meetings. She is likely to take the same stance when she testifies before the House Financial Services Committee on Wednesday. “Yellen’s comments yesterday suggesting the Fed will look at interest rates one meeting at a time were seen as providing less certainty of when an interest rate hike will be,” Citi analyst David Wilson said.
(Daily chart / 4 hourly chart below)
Gold February 25 at 22:50 GMT 1204.5 H: 1211.9 L: 1200.1
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1200 | 1170 | — | 1240 | 1300 | — |
During the early hours of the Asian trading session on Wednesday, Gold is enjoying solid support from the key $1200 level after finishing last week falling sharply. Current range: trading right around $1200.
Further levels in both directions:
• Below: 1200 and 1170.
• Above: 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 has dropped sharply back to near $1200. The trader sentiment is in favour of long positions.
Economic Releases
- 23:30 (Wed) JP CPI Core (Nation) (Jan)
- 23:30 (Wed) JP CPI Core (Tokyo) (Feb)
- 23:30 (Wed) JP Real Household Spending (Jan)
- 23:30 (Wed) JP Unemployment (Jan)
- 23:50 (Wed) JP Industrial Production (Prelim.) (Jan)
- 23:50 (Wed) JP Large Retailers Sales (Jan)
- 23:50 (Wed) JP Retail Sales (Jan)
- 00:30 AU Capital Expenditure (Q4)
- 09:00 EU M3 Money Supply (sa) (Jan)
- 10:00 EU Business Climate Index (Feb)
- 10:00 EU Consumer Sentiment (Feb)
- 10:00 EU Economic Sentiment (Feb)
- 10:00 EU Industrial Sentiment (Feb)
- 13:30 CA CPI (Jan)
- 13:30 US CPI (Jan)
- 13:30 US Durable goods (Jan)
- 13:30 US Initial Claims (21/02/2015)
- 14:00 US FHFA House Price Index (Dec)