Gold: Support At $1150 Standing Tall

 | Jul 14, 2015 14:56

Gold – Tuesday, July 14th, 2015

Throughout the last few weeks, gold has steadily declined and fallen from above the key $1200 level back to a new three month low below $1150 last week. It has, however, enjoyed some solid support from the $1150 level throughout last week, which stopped the sharp falls for the moment and allowed it to rally a little higher up to above $1160. In the last 24 hours, it has rallied higher, but run into resistance at $1160, which has sent it lower again back towards $1155. To finish out a couple of weeks ago, it was able to rally against the medium term down trend and move back above the $1170 level before easing off again. A couple of weeks ago, it surged higher to back above the key $1180 level before easing lower again. In the few days prior, gold had been easing back to below the key $1200 level after recently surging higher to a three week high above $1205.

The $1200 level remains significant, and is continuing to place selling pressure on gold and likely the $1180 level now too. Prior to the surge and in the last few weeks, gold has been content to trade around the key $1180 level. Several weeks ago, it rallied well to move from a two month low near $1160 back up to above $1190 again, before easing back to the $1180 level. The key $1180 level has consistently provided solid support and has held it up now for a couple of months, with the exception of the recent excursion below. About a month ago, gold fell sharply back through the key $1200 level and spent the remainder of that week consolidating in a narrow range around $1190. The $1200 level has been a significant level throughout most of this year and remains a key level presently, offering reasonable resistance to higher prices, whilst lower, the $1180 level continues to be significant. Throughout the last month or so, the $1180 level has provided some support and has been called upon recently.

Earlier in May, it was able to make a run through the $1200 level to reach a three month high above $1230; however, gold was quickly sold off and returned back to the $1200 level, where it enjoyed some support for several days. For around two months, through April, gold traded in a range between $1180 and around $1220, and had very few excursions outside these limits. Gold is currently pinned between resistance at $1200 and support at $1180, and it is surprising to see it trade in such a narrow range for several days. It seems it is waiting patiently for external factors to determine which level will be severely tested next.

(Daily chart / 4 hourly chart below)