Gold Shows Good Stamina Ahead of US Data
FxGrow | May 12, 2017 22:02
Gold recovered from Tuesday's 1214 low and steadied afterwards with an incline destination, maximizing profits with almost $5.50 as the precious metal clocks 1229.96 high for today's session. Yesterday, US data was positive with expectation that gold will break 1214 (Tuesday low), but XAUUSD hit a strong support at 1220 with a abstention for penetration, as a result, support level was successful and gold closed at 1224.70.
Recent events shows that Trump favors lower US dollar, and whenever US Dollar Index starts to build up, the US president is always there on the right time for tackling. Latest event where Trump gave Comey (FBI Deputy) one way ticket vocation had a negative impact on US financial market, which contributed to gold bullish forces today and yesterday.
Gold will have to submit for a final test this week as US releases hefty data which will re-test XAU/USD's stamina further more with expectations of heavy impact on market. In case gold followed yesterday's behavior with inability to break 1220 or Tuesday's low at 1214, indications are high that gold has finished from the decline journey and a bullish momentum is expected if XAU/USD managed to close above 1240.
Fundamentals:
1- USD - CPI m/m and Core CPI (Consumer Price Index) today at 12:30 PM GMT.
2- Retails Sales and Core Retails Sales today at 12:30 PM GMT.
Technical Overview:
Trend: Bearish Sideways
Resistance levels: R1 1230.34, R2 1235.61, R3 1228.42, R4 1242.17
Support levels: S1 1226, S2 1221, S3 1214, S4 1210.34
Comment: Gold remains bearish unless the market closes above 1240. Expectations are high that spikes would fight R1 level but in case of penetration, gold stretches for bull flags seeing R2&R3. On the other hand, yesterday gold dips were fighting S2 which indicates a strong level allied further selloffs and wash towards S3. U.S data not to be missed and keep an eye on Trump's next moves.
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