Gold appraoches 1400

Gold is still bounded in range of 1315.8 and 1388.1 in spite of all the volatility. Intraday bias remains neutral and another dip could still be seen to 38.2% retracement of 1155.6 to 1388.1 at 1299.3 before the consolidation concludes. On the upside, though, decisive break of 1388.1 high will confirm up trend resumption for 1400 psychological level next.

In the bigger picture, rise from 1155.6 is treated as the fifth wave of the five wave sequence from 1044.5, which should also be fifth wave of the rally from 681 (2008 low). While a short term top is in place at 1388.1, there is no confirmation of reversal yet. Recent up trend could still extend further to 161.8% projection of 931.3 to 1227.5 from 1044.5 at 1449.6 before completion. Though, we're aware of long term projection target of 100% projection of 253 to 1033.9 from 681 at 1462 and we'd anticipate strong resistance from there to bring medium term correction finally. On the downside, however, break of 1266.5 resistance turned support will be an early alert of medium term reversal and will turn focus back to 1155.6 support for confirmation.

GOLD - Set To Strengthen To 1,249.28

After a fifth day of recovery on Friday to end the week higher and taking back part of its weakness started from the 1,249.28 level, the commodity now looks to strengthen further towards the 1,226.33. It traded to as higher as 1,217.88 in today's trading session. A decisive break through its 2009 high at 1,226.33 is required to create scope for further strength towards the 1,249.28 level, its 2010 high with a break of there setting the stage for a move higher towards the 1,300 levels, its psychological levels and next the 1,350 level. Note that our overall outlook remains to the upside longer term. On any pullbacks, its psycho level residing at 1,200 will be targeted ahead of the 1,166.03 level, its May 21'10 low. A cap is expected here to turn the commodity back up in its original direction. Further out, the 1,156.90 level, its May 05'10 comes in as the next support. All in all, though Gold is now on the offensive, it requires a break and hold above the 1,249.28 level to resume its longer term uptrend.

Greek Uncertainty Pushes Gold Back

Profit taking has caused a decline in gold in early trading after it reached a week's high yesterday at $1159.84, as the Greek government requested the deployment of the 45 billion euro aid package provided by the EU and the International Monetary Fund (IMF).

Gold reached $1155.85 today, retreating 0.2%, while platinum rose by 0.6% to $1753.25. Palladium gained 1.7% advancing to $572.70 and silver ascended by 0.2% to $18.373.

The greenback appreciated against the euro after the German Finance Minister Wolfgang Schauble announced that Greece needs to provide clear commitment and plans on how to reduce its deficit in 2011 and 2012 and not only this year in order to receive further aid packages from the EU members. This may raise doubts whether Germany, the biggest contributor to the aid package, will show consent in aiding Greece.

The markets are in an alert state as they wait for the Greek finance minister to negotiate fund for the debt that matures May 19. All eyes are on Germany which may back away from the aid package aimed at reducing the 12.7% Greek budget deficit.

Gold is expected to remain stable at current prices, until a final solution for the Greek crisis will be found. The future outlook for precious metals is nonetheless bright, as platinum and palladium will be supported by Asian growing industries, while gold and silver will benefit from the global financial recovery.

S&P GSCI closed unchanged yesterday at 548.86, while RJ/CRB lost 0.67 points and closed at 278.38.

Gold futures due June at 2:44 EST fell by 0.05% to $1153.400, while silver futures retreated by 0.099% to reach $18.270 and copper futures fell by 3.600% to $351.200.

Consolidation likely for gold.

Gold closed lower due to long covering on Tuesday as it consolidated some of the rally off last week's low. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are overbought and are turning neutral hinting that a short-term high might be in or is near. Closes above the 20-day moving average crossing would confirm that a short-term top has been posted. If it extends this week's decline, February's low crossing is the next downside target.

Gold Prices Decline On Renewed Greece Budget Fears

The precious-metal prices are slightly changed while there are anticipations that Greece's budget woes continue which in the future will boost the dollar as investors seek safe-haven assets therefore reducing the appeal of gold as an alternative investment.

Friday, gold rose $15.70 or 1.44% to close at $1107.28 an ounce while the dollar lost strength six major currencies which are measured by the Dollar Index, declined Friday to close at 81.23 while recording a high of 81.38 and a low of 81.22.

Among other precious metals; platinum is traded at $1605.50 from $1597.50; palladium at $459.50 from $455.70; silver at $17.08 from $17.00; while, copper is at $346.86 from $346.30. Turning to commodity futures we see last week Friday, S&P GSCI closed at 512.99 points recording a high of 519.82 points and a low of 511.40 points while RJ/CRB Commodity closed at 267.32 points recording a high of 269.12 points and a low of 266.64.

SPDR gold trust, the largest exchange-traded fund backed by bullion in the world, stood steady at 1,124.64 metric tons. Gold was set in London on Friday at $1096.50 per ounce declining from $1098.00 per ounce during the AM fixing.

In addition, stocks in Asia climbed as a result of commodity and bank stocks rising while metal prices rose while China Petroleum & Chemical and China Construction Bank Corp. posting higher earnings.

Turning to oil, we see that prices are rising as a result of projections that there will be higher demand on fuel as a result of global economic recovery occurring therefore encouraging investors to enter oil markets as they seek potential in profits.

Currently, spot gold is traded at $1111.92 an ounce recording a high of $1112.80 an ounce and a low of $1105.55 an ounce.

Gold Regains Slightly As The Strong Dollar Continues Its Trend

Gold regained strength on Thursday but a strong greenback capped gains while uncertainties about the outcome of a European Union summit drove some investors away. 'There's a bit of physical buying and this is expected because the price has dropped nearly $20,' said a dealer in Hong Kong. 'But sentiment has turned bearish because we have broken several key support levels.' Uncertainty about currencies and debt problems in the euro zone had pushed up gold prices last week despite a stronger dollar, but dealers said buying had dissipated after bullion failed to sustain the gains. Gold is trading at $1,083 as of 21:34pm, GMT, with a bearish trend. Gold's Pool-Position is 43% Long, meaning that most Finotec clients are selling the precious metal.

Gold Rebounds Ahead Of The EU Summit

Precious-Gold rebounds from its lowest level in six weeks hit yesterday as the dollar halted its rally ahead of the EU Summit two-day meeting starting today. Meanwhile, gold is traded at $1091.90 an ounce after getting support at $1084.00 levels.

Yesterday, gold shed $15.30 or 1.39% to close at $1087.25 an ounce. Gold Price was set in London on Wednesday at $1090.75 per ounce during the PM fixing declining from $1094.00 at the AM fixing.

However, gold rose today as the U.S. dollar stopped its advance against majors as seen by the dollar index, which tracks the dollar movements versus a basket of major currencies, which fell to 81.79. The dollar index inclined after breaching resistance at 81.30 the previous day but stalled its rise after hitting resistance at 81.90, where it could not stay above it after reaching a high of 82.05.

The largest boost given by the dollar index was from the euro which represents 57.6% of the index as it is currently traded near 10-month low against the green currency. Still, the outlook for the 16-nation currency is frightening due to concerns surrounding the bailout of Greece.

It seems that Greece will not receive an aid after the EU Summit, especially as Germany referred that the IMF is optimal solution for helping Greece. The euro is predicted to remain under pressure with the high deficit problems spilling over EU members. Fitch Ratings lowered Portugal's sovereign credit rating to AA-minus from AA yesterday and said that it sees negative outlook for the country. Spain is also suffering from high debt along with other macroeconomic problems.

The depreciation of the euro is affecting gold that dropped $18 since Monday. The shiny metal reached high records last year as a hedge against inflation on the back of the huge spending by governments and central banks all over the world, but now with the decline in inflation levels and gradual scale back of stimulus gold may lose momentum again.

Gold Tries to Recover From $1100 Reversion

Gold dove back below its highly psychological $1100/oz level and set new March lows after a wave of risk aversion hit the FX markets. Investors fled to the Dollar after Fitch lowered Portugal’s credit rating. With Greece’s financial assistance plan still up in the air, another debt scare in the EU has accelerated Dollar flows in risk aversion, highlighted by large gains in the USD/JPY. Gold has reacted negatively to today’s development since the precious metal tends to have a negative correlation with the Greenback. However, downside movements in gold have been somewhat limited compared to the selloffs taking place in the EUR/USD and Cable. Gold has managed to regain its footing before a retest of February lows. However, we’ll have to see how the trading session progresses since problems in the EU could continue to benefit the Dollar. U.S. New Home Sales just printed below analyst expectations, which could help buoy gold and deflate the Dollar intraday since it works against speculation that the Fed will raise sooner than anticipated, a Dollar negative. We notice slight strength in the Cable and EUR/USD in reaction to the news, though we’ll see whether it has staying power. All eyes will be on the EU summit tomorrow, although expectations have been lowered by persistent rebuttals from Germany. The EU, UK and U.S. will also through in some data points, making tomorrow’s trading session a bit interesting.

Technically speaking, gold has intraday and February 2010 lows serving as technical cushions along with the psychological $1075/oz level should it be tested. As for the topside, gold faces multiple downtrend lines along with 2/25 and intraday highs. Meanwhile, the psychological $1100/oz level could continue to have an influence on gold as long as the precious metal remains within striking distance.

Present Price: $1092.50/oz
Resistances: $1093.37/oz, $1094.92/oz, $1096.18/oz, $1097.26/oz, $1098.10/oz, $1099.32/oz
Supports: $1092.23/oz, $1091.40/oz, $1089.78/oz, $1088.72/oz, $1086.90/oz
Psychological: $1100/oz, February lows

Gold Declines with Risk Aversion

Gold is pulling back slightly as risk aversion hits the FX markets. Greece has set up a showdown with Germany by giving the EU one week to come up with financial assistance measures before it heads to the IMF for help. Germany has been calling Greece’s bluff by publicly contemplating the possibility of Greece going to the IMF. However, Trichet recently stated that the ECB feels it would be unwise to go this route. In all, the increase in uncertainty has triggered a large selloff in the Euro which is weighing down on gold and leading investors towards the Dollar for safety. However, Gold’s intraday losses have been minimal thus far compared to the pullback in the EUR/USD. Therefore, it will be interesting to see whether the precious metal can continue to hold strong above 3/18 highs and avoid a more sizable downturn in the process. The data wire will be relatively quiet tomorrow, meaning attention could continue to be focused on the EU and any other psychological developments.

Technically speaking, gold faces multiple downtrend lines along with intraday, 3/16and 3/17 highs. As for the downside, gold still has multiple uptrend lines serving as technical cushions along with 3/18 lows and the highly psychological $1100/oz level should it be tested.

Present Price: $1120.20/oz

Resistances: $1120.40, $1121.84, $1122.65/oz, $1124.27/oz, $1125.63/oz, $1127.33/ oz

Supports: $1118.51/oz, $1117.66/oz, $1116.00/oz, $1114.53/oz, $1112.84/oz

Psychological: $1100/oz, $1150/oz, March highs and lows

Gold Yields Following Solid Pop

Gold experienced a solid rally yesterday as the precious metal’s negative correlation with the Dollar kicked back into 1st gear. The Cable, Aussie, and EUR/USD all experienced topside breakouts yesterday in the wake of the Fed’s decision to maintain its loose monetary policy stance for the foreseeable future. Yesterday’s return to the risk trade certain benefitted gold as the precious jumped from $1100/oz and peaked just above $1130/oz and our new 3rd tier downtrend line. Our 3rd tier runs through previous March highs, or the $1145/oz area. Hence, if gold can manage to break past our 3rd tier this could indicate more substantial near-term gains. Meanwhile, investors should keep an eye on the Greenback and monitor the ability of the risk trade to expand on yesterday’s gains. The Cable did break through some key downtrend lines and the Aussie is continuing its steady ascent, creating a favorable correlative environment for gold. Bernanke will testify before congress this afternoon, a potential market mover. Additionally, the U.S. will print a wave of data tomorrow. Hence, activity could pick back up this afternoon and during tomorrow’s U.S. session. Additionally, investors should keep an eye out for any more psychological developments hitting the wire regarding EU and UK fiscal problems since these headlines can jolt currencies as well.

Technically speaking, gold faces multiple downtrend lines along with intraday, 3/5and 3/3 highs. As for the downside, gold still has multiple uptrend lines serving as technical cushions along with intraday, 3/9, and 3/11 lows.

Present Price: $1123.20/oz

Resistances: $1124.29, $1125.52, $1127.77/oz, $1129.41/oz, $1131.05/oz, $1132.48/ oz

Supports: $1121.83/oz, $1120.39/oz, $1118.34/oz, $1116.70/oz, $1114.50/oz, $1112.81/oz

Psychological: $1100/oz, $1150/oz, March highs and lows

Gold Inclines As The U.S. Dollar Slides

The yellow metal surged on Friday as the U.S. dollar slumped against majors which enhanced demand on gold as an alternative investment.

Yesterday, gold gained $1.40 or 0.13% to close at $1109.32 an ounce. Gold Price was set in London on Thursday at $1106.00 per ounce during the PM fixing inclining from $1104.00 at the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, remained at 1,115.51 metric tons on March 11.

Today, gold prices climbed to $1113.44 an ounce after recording a high of $1114.00 and a low of $1107.80. The shiny metal took advantage of the dollar's fall and the oil's rally. The U.S. dollar plunged against a basket of major currencies as seen by the dollar index on the daily charts. The index dropped to 80.09 close to strong support at 80.07.

On the other hand, oil little changed today but still traded above $82 a barrel ahead of the release of retail sales and confidence in the U.S. Actually, gold gained in the previous period as a safe haven due to the escalating debt woes in Greece, but it may halt its advance as the problem eases. EU policy makers will meet Greek officials this week end and they might bailout Greece as announced this month by President Sarkozy.

Moreover, another downward pressure may come from the start of tightening of monetary measures by central banks all over the world. China's inflation rose yesterday to 16-month high and industrial production jumped to the highest in more than five years which is raising concerns the Chinese central bank would unwind stimulus faster than expected.

Gold lost more than seven percent since reaching its historical high in December last year and it is girding for its first weekly drop in four. With regard to other precious metals, platinum edged up to $1612.50 from the day's opening at $1609.20; palladium soared to $460.00 from $457.70; and silver inclined to $17.23 from $17.15, as of 08:55 GMT.

Gold Steadies As The Dollar Halts Its Rise For The Time Being

Gold steadied on Wednesday after the euro bounced slightly higher against the U.S. dollar though weaker oil prices could prompt new selling, traders said. Dealers noted early bargain hunting from Chinese speculators but gold prices were susceptible to sharp movements due to low volumes. Platinum and palladium slipped in early trade but held near recent highs. Gold was around 2 percent below a 6-1/2-week high near $1,150 hit in early March. Several attempts to revisit a lifetime high around $1,200 struck in early December were met by heavy profit taking but steady investor interest could lend Support. Gold is trading at $1,108 as of 21:20pm, GMT, with a bullish trend.

Gold Drops Amid Risk Aversion

Gold has tacked onto yesterday’s 1% pullback in reaction to a broad-based downturn in the risk trade. Hence, it seems gold is following its negative correlation with the Dollar once again. On the bright side, gold has avoided a retest of its highly psychological $1100/oz level and remains above the lower band of its trading range. Hence, the possibility of a return of gold’s upward momentum is not out of the question as investors lock in profits over the past couple trading sessions. Much will depend on the Dollar’s reaction to upcoming economic data releases from China over the next couple trading sessions. Strong Chinese data could favor the risk trade and send gold higher, whereas negative data could very well have the opposite effect. Meanwhile, it will be interesting to see of gold can stabilize above its highly psychological $1100/oz level. Additionally, our new 1st tier uptrend line could serve as a key support since it runs through February lows, or the $1090/oz area.

Technically speaking, we’ve formed two new makeshift downtrend lines running through 3/2 and 3/3 levels to give investors an idea of present resistance. Additionally, gold must face previous March highs and the psychological $1050/oz area to the topside. As for the downside, gold still has multiple uptrend lines serving as technical cushions, highlighted by our 1st tier as we mentioned before. Furthermore, gold has the psychological $1100/oz level working in its favor should it be tested.

Present Price: $1113.24/oz

Resistances: $1114.21/oz, $1116.63/oz, $1118.75/oz, $1121.05/ oz, $1123.03/oz, $1124.97/oz

Supports: $1112.11/oz, $1110.07/oz, $1107.26/oz, $1104.71/oz, $1101.73/oz, $1099.20/oz

Psychological: $1100/oz, $1150/oz, January Highs, March highs and Lows

Consolidation likely for gold.

Actually, gold is moving within very sensitive areas that represent 76.4% Fibonacci level for the downside rally from 1162.00 to 1044.00, while 1137.00 zones represent 127% from the BC leg of a suggested bearish harmonic AB=CD pattern. Therefore we believe that the metal could pullback to the downside during this week. A break of 1162.00 is able to damage this bearish anticipation and if that occurred, the pivotal resistance areas of 1185.00 could be retested easily. Stochastic and AROON support this negative scenario.

The trading range for this week is among the key support at 1095.00 and key resistance now at 1185.00.

The general trend is to the upside as far as 865.00 remains intact with targets at 1249.00.

Support: 1132.00, 1125.00, 1109.00, 1102.00, 1095.00
Resistance: 1144.00, 1151.00, 1155.00, 1162.00, 1176.00

Gold Tops and Declines

Gold has topped out and is trading back around $1130/oz following the precious metal’s solid topside breakout. Gold is heading lower following a negative reaction to U.S. data revealing a large decline in Pending Home Sales. Today’s discouraging U.S. housing figure sent investors towards the Dollar for safety, knocking the risk trade and dragging gold lower with it. The precious metal was outperforming lately despite the Dollar’s strength. However, gold is playing along today and some profit taking isn’t surprising since the precious metal was getting awfully close to its psychological $1150/oz level and previous 2010 highs. Meanwhile, the markets could end the trading session on a volatile note with an important EU meeting tomorrow followed by key U.S. employment data. The U.S. will release its Non-Farm Employment Change and headline Unemployment Rate figures. Although the ADP printed about in line with expectations on Wednesday, the advance number has been known to be somewhat unreliable in the past. Therefore, investors should keep an eye on the Dollar’s reaction to tomorrow’s news and data events.

Technically speaking, we’ve formed two new makeshift downtrend lines running through 3/3 levels to give investors an idea of present resistance. Gold is still well above downtrend lines running through 2/19 and 1/11 highs, meaning there aren’t any foreseeable noteworthy downtrend lines in play right now. As for the downside, gold has multiple uptrend lines serving as technical cushions along with 3/2 lows. Additionally, the highly psychological $1100/oz level could serve as a reliable technical cushions should it be tested.

Present Price: $1128.95/oz

Resistances: $1131.07/oz, $1134.88/oz, $1138.68/oz, $1140.96/ oz, $1143.46/oz, $1146.29/oz

Supports: $1126.71/oz, $1123.03/oz, $1120.42/oz, $1117.76/oz, $1114.72/oz, $1110.53/oz

Psychological: $1100/oz, $1125/oz, $1150/oz, January Highs, March Lows

Gold Floats Around $1100/oz Despite Risk Aversion

Gold is floating just beneath its highly psychological $1100/oz level despite broad-based risk aversion in the FX markets. The Cable, Aussie, USD/JPY and EUR/USD have all made large legs down today amid fresh uncertainty in Greece. Additionally, economic data from around the globe was less than encouraging, particularly the rise in weekly U.S. Unemployment Claims. Today’s negative psychological and fundamental developments have led investors for safety, reflected in the downturn in the risk trade. However, gold is holding up very well considering the rise in the Dollar and Yen. Gold has been negatively correlated with the Dollar, making its present stability intriguing. Meanwhile, the risk trade is trying to right itself at the moment, so it will be interesting to see if gold can pop back above $1100/oz regardless of strength in the Dollar. The UK and U.S. will both release GDP data tomorrow, meaning volatility in the FX markets could end the week on a volatile note. Hence, gold may follow suit if the Dollar’s run continues.

Technically speaking, gold faces multiple downtrend lines along with 2/24 and 2/23 highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with intraday and 2/12 lows. Furthermore, the psychological $1100/oz level could continue to play an influential role over the near-term.

Present Price: $1093.80/oz

Resistances: $1094.34/oz, $1096.04/oz, $1098.51/oz, $1100.74/ oz, $1103.10/oz, $1106.18/oz

Supports: $1091.58/oz, $1089.87/oz, $1087.66/oz, $1085.21/oz, $1083.25/oz, $1080.79/oz

Psychological: $1100/oz, $1125/oz, February highs and lows

Gold Drops Below $1100/oz

Gold is trading back below its highly psychological $1100/oz level amid weakness in the Cable and Aussie. Gold’s large leg down during today’s Asia trading session is a bit mysterious since the precious metal exhibited a relative weakness. That being said, investors should keep an eye on activity in the Dollar. Investors will have their eyes fixed on U.S. New Home Sales and Bernanke’s Congressional testimony. Statements from Bernanke have the potential to create considerable volatility in the FX markets. Hence, should Bernanke give any hints regarding a tighter monetary policy from the Fed, this could favor the Dollar and place further downward pressure on gold. On the other hand, should Bernanke reiterate a loose monetary policy for the foreseeable future the risk trade may be able to continue its stabilization and keep gold around $1100/oz. However, the risk trade is tilting lower ahead of Bernanke, so it will be interesting to see how today’s trading session plays out. Meanwhile the psychological $1100/oz level could continue to have an influence on gold. Volatility in the FX markets could continue tomorrow with the release of Durable Goods Orders along with statements from King and Bernanke. Investors should also keep an eye on the EUR/USD and Cable and their ability to hold above February lows.

Technically speaking, gold faces multiple downtrend lines along with intraday and 2/22 highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with 2/18 lows and the highly psychological $1100/oz level should it be tested.

Present Price: $1094.25/oz

Resistances: $1096.04/oz, $1098.51/oz, $1100.74/ oz, $1106.18/oz, $1107.91/oz

Supports: $1093.81/oz, $1091.58/oz, $1089.87/oz, $1087.66/oz, $1085.21/oz, $1083.25/oz

Psychological: $1100/oz, $1125/oz, February highs and lows

Gold Sinks with Negative Global Data

Gold is trading well off Monday highs as investors exit the risk trade in the wake of more negative fundamental data from around the globe. The selloff began with weaker than expected French Consumer Spending and German Ifo Business Climate data from the EU along with discouraging UK BBA Mortgage Approvals data. Additionally, the U.S. just reported a sizable step back in CB Consumer Confidence. Hence, the fundamental picture is altogether negative today, resulting in sizable pullbacks in the USD/JPY, EUR/USD, and Cable. The negative reaction of the risk trade is dragging gold lower due to its usual negative correlation with the Greenback. It will be interesting to see whether the EUR/USD and Cable can hold above previous February lows and salvage their previous upward momentum, for another setback in the risk trade could weigh on gold due to correlative forces. However, gold is still trading above $1100/oz, which has proven to be an influential psychological zone in the past. The U.S. will release New Home Sales tomorrow in succession with Bernanke’s Congressional testimony. As a result, volatility could increase in the next 24 hours as investors look for further insight from Bernanke in regards to the Fed’s future monetary policy plans.

Technically speaking, gold faces multiple downtrend lines along with intraday and 2/22 highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with 2/18 lows and the highly psychological $1100/oz level should it be tested.

Present Price: $1106.10/oz

Resistances: $1106.18/oz, $1107.91/oz, $1110.64/ oz, $1113.36/oz, $1116.08/oz, $1118.31/oz

Supports: $1103.46/oz, $1100.74/oz, $1098.51/oz, $1096.04/oz, $1093.81/oz, $1090.84/oz

Psychological: $1100/oz, $1125/oz, February highs

Gold Consolidates with Risk Trade

Gold is holding strong well above Friday lows and its highly psychological $1100/oz. However, the precious metal is trading off of Friday highs as the risk trade consolidates across the board. We recognize profit taking in the EUR/USD and Cable. That being said, these two currency pairs still have quite an uphill battle to face on the route to recovery from this year’s surge in the Dollar. Gold is performing well considering the uncertainty in the risk trade and the precious metal’s negative correlation with the Greenback. On the other hand, gold’s resilience could also signal that the risk trade is oversold. Therefore, investors should keep an eye on activity in the major Dollar pairs to determine whether we are witnessing a real bottom in the risk trade or just another bounce. Much of that will depend on upcoming economic data releases and whether there is more unexpected news from the EU’s PIIGS nations. Furthermore economic uncertainty in the EU could lead investors back towards the Dollar and out of gold. Gold broke through some key downtrend lines over the past few trading sessions, meaning momentum is pointing in favor of the topside. However, FX markets have been extremely volatile lately, meaning the tide has the potential to turn quickly.

Technically speaking, gold faces multiple downtrend lines along with 2/17 and 2/19 highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with 2/18 lows and the highly psychological $1100/oz level should it be tested.

Present Price: $1121.10/oz

Resistances: $1121.19/oz, $1123.67/oz, $1126.15/ oz, $1128.21/oz, $1130.93/oz, $1133.40/oz

Supports: $1117.32/oz, $1115.34/oz, $1113.61/oz, $1111.63/oz, $1107.91/oz, $1105.93/oz

Psychological: $1100/oz, $1125/oz, February highs

Gold Holds Above $1100/oz Despite Dollar Rally

Gold managed to hold above Thursday’s lows and the highly psychological $1100/oz level despite broad-based strength in the Dollar in reaction to the Fed’s surprise decision to raise the discount rate. The Fed’s decision shocked FX markets after the bell, sending investors rushing towards the Dollar after interpreting the Fed’s announcement as a signal that the exit strategy from loose liquidity has begun. Although gold did experience sizable down-bars on the 4-hour, the pullback wasn’t nearly as intense as what occurred in the EUR/USD. Hence, stability in gold could signal an overreaction in the major Dollar pairs. However, should the risk trade continue its freefall gold may be inclined to follow suit due to its usual negative correlation with the Greenback. Regardless, resilience in gold the past 24-48 hours has been interesting and should be watched by investors. Meanwhile, volatility in the FX markets could remain volatile over the near-term considering the extent of this week’s pullback. Trading ranges could be wide until the Dollar settles and a new normal is established. However, it remains to be seen whether this will translate into gold’s activity.

Technically speaking, gold faces multiple downtrend lines along with 2/18 and 2/17 highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with 2/18 lows and the highly psychological $1100/oz level should it be tested.

Present Price: $1114.30/oz

Resistances: $1115.98/oz, $1117.72/oz, $1119.70/ oz, $1121.19/oz, $1123.67/oz, $1126.15/oz

Supports: $1114.24/oz, $1112.01/oz, $1110.03/oz, $1108.29/oz, $1106.56/oz, $1103.33/oz

Psychological: $1100/oz, $1125/oz, February highs and lows

Gold Declines On Firmer Dollar

Precious-Gold slipped for the second day, paring some of its weekly advance, as the U.S. dollar strengthened which reduced that appeal of the metal as an alternative investment.

Yesterday, gold shed $11.00 or 0.98% to close at $1106.55 an ounce. Gold Price was set in London on Wednesday at $1019.00 per ounce during the PM fixing inclining from $1118 25 during the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, stood at to 1,106.37 metric tons on February 17.

Spot gold is traded at $1100.66 an ounce, a little bit above strong resistance at $1100.00, after recording a high of $1109.15 and a low of $1097.66. The shiny metal dropped suddenly the previous day after the IMF mentioned it would sell gold in open market to generate additional sources for lending. IMF announced in September it is planning to sell 13% of its gold reserves; thus the IMF's intension was known previously which shows that the dollar's rebound accelerated the fall.

The dollar index, which tracks the dollar movements against a basket of major currencies, bounced for the second day to 80.63, reaching the highest in 9 months versus the euro, after breaching strong support at 80.07 which reduced demand on all dollar-denominated commodities.

The greenback probably will continue its rally that started since December on improved outlook for the U.S. which is increasing speculations the FED would raise interest rate faster than other Central Banks. Production and housing data released yesterday beat estimates ahead of the release of other important U.S. data later on today which are expected to show further progress. On the other hand, investors are wary of buying the euro on concerns the European Central Bank will need to raise money for supporting Greece.

With regard to other precious metals, platinum edged down to $1506.50 from the opening at $1508.00; palladium inclined to $425.50 from $427.50; and silver remained unchanged at to $15.75

GOLD To Test Key Resistance

GOLD (Futures): With a follow-through higher on its Monday gains currently seen, risk of further corrective recovery momentum now targets its strong swing high at its Feb 03’10 high at 1,125.00. We expect a cap at this level to turn the commodity back down but if that fails to materialize, more strength could be seen targeting its Jan 20’10 high at 1,141.48. Its daily RSI is bullish and pointing higher supporting this view. To the downside, immediate support lies at the 1,104.08 level, its Jan 25’10 high with a turn below there allowing for more downside pressure towards the 1,072.14/1,073.95 levels with a break below there pushing Gold further lower towards the 1,044.20 level, its YTD low. A loss of the latter will resume its short term downtrend towards the 1,030.85/1,026.55 levels, its Mar’08 high/Oct 28’09 low and then the 986.67 level, its Oct’09 low. On the whole, Gold continues to build on its corrective recovery and now targets the 1,125.00 level and possibly higher.

Gold Little Changed, Above $1095

Precious-Gold slightly changed on Monday in thin trading in markets due to holidays and as the dollar remains firm.

Last Friday, gold shed $0.20 or 0.02% to close at $1093.15 an ounce. Gold Price was set in London on Friday at $1082.00 per ounce during the PM fixing declining from $1078.25 at the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, stood at 1,106.37 metric tons on February 12.

Spot gold is traded at $1095.20 an ounce after recording a high of $1097.06 and a low of $1091.60. Prices remain under pressure due to the dollar's continuing advance against majors which is reducing the appeal of the commodity as an alternative investment.

Meanwhile, the greenback is traded near the highest level in 9 months versus the euros and one-week high against the yen. The 16-nation currency is showing weakness ahead of the EU finance ministers' 2-day meeting staring today in Brussels, where they will introduce measures to bailout Greece and put rescue plan for possible debt woes in other European economies, especially Spain and Portugal.

Investors are waiting for detailed plan for endorsing Greece which may help the euro to pare some of its losses. The U.S. dollar is gaining on expected faster recovery in the U.S.; Bernanke, the Federal Reserve Chairman said last week they will raise discount rate and start unwinding stimulus.

On the other hand, European shares advanced today ahead of the meeting, while Asian stocks dropped on concerns that China will cool its economic growth at the time where some Asian markets are closed for the Lunar New Year holiday, while U.S. markets are also closed for Presidents Day.

With regard to other precious metals, platinum inched up to $1512.50 from the opening at $1510.50; palladium plummeted to $413.50 from $415.70; and silver ticked up to $15.49 from $15.47.

Gold Declines As The Dollar Strengthens

The shiny metal slid for the second day as the dollar advanced against majors, thereby reducing demand on the metal as an alternative investment.

Yesterday, gold shed $4.10 or 0.37% to close at $1109.60 an ounce. Gold Price was set in London on Wednesday at $1115.25 per ounce during the PM fixing declining from $1118.50 at the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, slipped 1.58 metric tons to 1,110.34 metric tons on February 3.

The shiny metal is negatively impacted by the dollar's rally that started in December. The improved U.S. data and outlook for the U.S. economy are endorsing the Federal currency. The dollar index, a gauge of the dollar movements versus a basket of major currencies, surged to 79.63 from the day's opening at 79.41.

Meanwhile, the greenback is traded near its highest level in seven months versus the 16-nation currency as debt woes in European economies are raising concerns and thereby weighing on the euro. However, the dollar's direction may be determined largely after the non-farm payrolls report due tomorrow.

Moreover, the dollar's rally adversely affected all dollar-denominated commodities. S&P GSCI added 2.73 points to 501.39 and RJ/CRB Commodity pushed up 2.61 points to 270.58 the previous day, whereas crude oil declined to near $76.17 a barrel from $76.97 in the preceding day's closing.

Spot gold inclined to $1102.80 an ounce today, recording a high of $1111.10 and a low of $1102.75. The yellow metal is facing resistance at $1113.00 while gaining support at $1100.00.

With regard to other precious metals, platinum edged down to $1541.40 from the opening at $1559.40, whereas palladium plunged to $427.00 from $432.70.

Gold Fluctuates Wildly as Investors Digest Data

Gold has been all over the place today. The previous metal climbed higher during the Asia trading session as the risk rally continued in light of Australia’s encouraging Trade Balance data coupled with news the EU is accepting Greece’s plan to reduce its fiscal debt. However, gold reversed course and dove back to intraday lows after U.S. ADP Non-Farm Employment Change data printed stronger than analyst estimates. The positive headline ADP number sent investors back towards the Dollar in a hurry, registering large down bars in the EUR/USD and AUD/USD in the process. The Dollar’s rally resulted in an accompanying decline in gold due to correlative forces. Meanwhile, investors are awaiting U.S. Services PMI data due shortly. That being said, FX markets and gold could remain active throughout the remainder of the session. Speaking of volatility, the ECB and BoE will make monetary policy decisions during tomorrow’s trading session along with weekly U.S. Unemployment Claims. Hence, gold and the Dollar could remain active for the next 24-48 hours. Investors should monitor behavior in the major Dollar pairs closely for any new direction signals for this could be a telling sign for gold.

Technically speaking, gold’s earlier rally sent the precious metal beyond our 2nd tier downtrend line, a very positive development considering it runs through 2010 highs, or the $1160/oz area. However, gold has dipped back below our 2nd tier and remains under the influence of behavior in the Dollar. Hence, there are still downward forces at play. Gold now faces our 2nd and 3rd tier downtrend lines to the topside along with intraday highs. As for the downside, gold has multiple uptrend lines serving as technical cushions along with intraday and 2/2 lows.

Present Price: $1116.83/oz

Resistances: $1118.08/oz, $1121.04/ oz, $1124.86/oz, $1128.66/oz, $1132.02/oz, $1135.04/oz

Supports: $1113.71/oz, $1110.73/oz, $1107.33/oz, $1103.94/oz, $1100.55/oz

Psychological: $1100/oz, January highs and lows

Gold Drives Past $1100/oz

Gold has popped back above its highly psychological $1100/oz level despite a large step back in the AUD/USD during the Asia trading session. Outside of volatility in the Aussie, we recognize stability in both the Cable and EUR/USD as negative psychological forces subside. Consolidation and stabilization in these two currency pairs has allowed gold to gain back some lost ground from what now appear to be oversold conditions. Meanwhile, the S&P futures are logging solid gains this morning after U.S. Pending Home Sales printed above analyst expectations, continuing the theme of strong U.S. economic data. Encouraging U.S. data is proving to be a positive catalyst for gold since the precious metal is positively correlated with U.S. equities. That being said, the U.S. will release Services PMI and ADP Employment Change data tomorrow. Hence, volatility in the FX and currency markets could pick up over the next 24-48 hours. In the mean time investors should keep an eye on activity in the Dollar and take note of any further directional breakouts.

Technically speaking, gold has hopped above our 3rd tier downtrend line, a positive technical development considering our 3rd tier runs through 1/20 highs, or the $1040/oz area. Hence, gold could be in for further topside movement over the near-term should the previous metal hold above our 3rd tier downtrend line. As for the downside, we’ve readjusted our uptrend lines to compensate for today’s gains. Therefore, gold has multiple uptrend lines serving as technical cushions along with the psychological $1100/oz level.

Present Price: $1111.50/oz

Resistances: $1113.71/oz, $1117.38, oz, $1121.03/oz, $1125.92/oz, $1128.66/oz, $1132.01/oz

Supports: $1109.44/oz, $1106.40/oz, $1102.13/oz, $1099.07/oz, $1094.19/oz

Psychological: $1100/oz, January highs and lows

Gold Consolidates Below $1100/oz

Gold is continuing its consolidative pattern despite wild fluctuations in the FX market. The Combination of the Fed’s monetary policy decision, weak housing and unemployment data, and Obama’s State of the Union have provided more than enough data and news to move markets. While New Home Sales drove the Dollar higher, negative New Home Sales data sent the risk trading reeling only to be boosting back up by the Fed maintaining its loose monetary policy. Furthermore, Obama’s speech garnered a positive reaction from equities and helped send the risk trade higher once again. However, disappointing Unemployment Claims data has led investors back to safety. The FX markets have been all over the map to say the least. Gold has remained relatively calm amidst the volatility and it seems the precious metal is waiting for a more definitive directional commitment from the Dollar before settling upon a direction itself. Meanwhile, Congress may vote upon Bernanke’s confirmation today and investors are eagerly awaiting tomorrow’s U.S. Advance GDP data. Hence, FX markets should remain volatile throughout the remainder of the week and it will be interesting to see whether gold decides to participate. That being said, FX investors should keep an eye on gold and monitor the precious metal for a direction breakout for it could signal a similar movement in the Dollar.

Technically speaking, gold has our 1st tier uptrend line serving as a technical cushion along with January lows should they be tested. As for the topside, gold faces a few steep downtrend lines along with the highly psychological $1100/oz level. Furthermore, intraday and 1/26 highs could serve as technical barriers should they be reached.

Present Price: $1088.30/oz

Resistances: $1087.56/oz, $1085.32/oz, $1082.10/oz, $1078.92/oz, $1074.44/oz, $1070.65/oz

Supports: $1093.32/oz, $1096.91/oz, $1101.00/oz, $1103.49/oz, $1106.76/oz, $1109.96/oz

Psychological: $1075/oz, $1100/oz, January lows

Gold Consolidates as Investors Wait for Data and Fed

Gold is continuing its consolidation around the psychological $1100/oz level as the Dollar wavers ahead of U.S. New Home Sales and the Fed’s monetary policy decision. The chaotic appearance of our chart implies that gold could be approaching a turning point. All of our trend lines are colliding while the EUR/USD and AUD/USD trade around key supports. That being said, investors should monitor the major Dollar crosses for any considerable technical setbacks for this could forewarn of a similar decline in gold. On the other hand, should the major Dollar pairs be able to stabilize and the Dollar weaken, this could help gold make up for some of January’s lost ground. In addition to today’s data and Fed decision, Obama will also deliver his State of the Union tonight followed by U.S. Durable Goods Orders tomorrow. Hence, volatility could pick up over the next 24-48 hours.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along December ’09 lows should they be tested. As for the topside, gold faces a few steep downtrend lines along with the highly psychological $1100/oz level. Furthermore, intraday and 12/31 highs could serve as technical barriers should they be reached.

Present Price: $1093.25/oz

Resistances: $1096.91/oz, $1100.67/oz, $1103.49/oz, $1106.31/oz, $1110.07/oz, $1115.39/oz

Supports: $1088.45/oz, $1085.01/oz, $1082.10/oz, $1079.30/oz, $1074.95/oz, $1070.65/oz

Psychological: $1075/oz, $1100/oz, December lows

Gold Negated by $1100/oz as Dollar Strengthens

Gold has reversed from our 2nd tier downtrend line and the psychological $1100/oz level as investors snap up the Dollar in another wave of risk aversion. The wave of Dollar strength began during today’s Asia trading session as China’s major banks indicated they are serious about reducing the issuance of new loans. Additionally, the S&P lowered its credit rating outlook for Japan, another positive development for the Dollar considering the negative message this sends in regards to the health of the global economic recovery. Furthermore, the UK just printed a Prelim GDP figure 3 basis points below analyst expectations. Hence, there is a combination of negative developments contributing to strength in the Greenback. However, despite today’s pop in the Dollar gold’s reaction has been somewhat limited thus far. Perhaps it’s the fact that gold is deciding how to deal with $1000/oz while hovering just above previous January lows. Meanwhile, volatility in the FX markets should remain at a heightened state with the release of U.S. CB Consumer Confidence later today. Additionally, Australia will print CPI during tomorrow’s Asia trading session followed by U.S. New Home Sales and the Fed’s monetary policy decision. That being said, investors should keep an eye on key support in the major Dollar pairs because further deterioration could have enough of an influence to drag gold below previous 2010 lows.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along December ’09 lows should they be tested. As for the topside, gold faces a few steep downtrend lines along with the highly psychological $1100/oz level. Furthermore, intraday and 12/31 highs could serve as technical barriers should they be reached.

Present Price: $1091.00/oz

Resistances: $1095.66/oz, $1100.67/oz, $1103.49/oz, $1106.31/oz, $1110.07/oz, $1115.39/oz

Supports: $1088.45/oz, $1085.01/oz, $1082.10/oz, $1079.30/oz, $1074.95/oz, $1070.65/oz

Psychological: $1075/oz, $1100/oz, December lows

Gold Begins Week Rebounding From One-Month Low

The precious-metal prices climbed as investors turned to gold seeking a safe-haven investment especially after U.S. President Barack Obama's is planning to limit banks to be involved in risky transactions. As investors start buying gold, supports prices to incline from the one-month low.

The dollar is depreciating in the markets ahead of the U.S. economy releasing its existing home sales showing that they fell in December based on expectations, as existing home sales decline, meant that the reason behind the downfall of the nation is still not solved, therefore causing investors to sell dollar in disappointment.

Friday, gold fell $1.60 or 0.15% to close at $1091.50 an ounce as the dollar lost strength six major currencies which are measured by the Dollar Index, declined Friday to close at 78.26 while recording a high of 78.52 and a low of 78.03.

Among other precious metals; platinum is traded at $1540.40; palladium at $435.50; silver at $17.09; while, copper is at $334.05. Turning to commodity futures we see last week Friday, S&P GSCI closed at 501.53 points recording a high of 509.64 points and a low of 500.74 points while RJ/CRB Commodity closed at 275.56 points recording a high of 277.51 points and a low of 275.08.

SPDR gold trust, the largest exchange-traded fund backed by bullion in the world, stood steady at 1,111.92 metric tons. Gold was set in London on Thursday at $1084.00 per ounce declining from $1096.50 per ounce during the AM fixing.

In addition, stocks in Asia declined for the sixth consecutive day marking the longest declines in a row since July, as a result of worries that financial institutions in China, seek more capital since earnings are not enough to cover dividends for shareholders.

Turning to oil, we see that prices are trading close to a one-month low as stock markets decline therefore commodity producer companies' stocks decline. Also there are worries that the second biggest oil consumer, China, might increase interest rates therefore weighing on growth levels.

Currently, spot gold is traded at $1100.15 an ounce recording a high of $1103.27 an ounce and a low of $1092.10 an ounce.

Gold Drops Like a Rock as Equities Tumble

Gold is undergoing a hefty selloff right now as the S&P futures drop through key technical supports in reaction to weaker than expected weekly Unemployment Claims and Philly Manufacturing data. Today’s negative data set tipped the scale considering the rally the Dollar has been on lately. The Dollar initially rallied during the Asia trading session after China’s pricing data printed hotter than analyst expectations, extending gains in the Dollar against all major pairs as investors headed for safety in fear of tighter liquidity from China. Gold followed the Dollar’s lead, declining to its psychological $1100/oz level before bouncing off our 1st tier uptrend line. However, gold has since dropped below our 1st tier and we notice a similar pullback in the S&P futures. Hence, we could be entering a more extensive decline for both gold and the S&P futures over the near-term. Our 1st tier uptrend line carries added weight since it runs through December 09 lows, or the psychological $1075/oz area. Meanwhile, investors should keep an eye on the S&P futures and monitor their ability to stabilize for such an occurrence could allow gold to set a temporary bottom.

Present Price: $1095.20/oz

Resistances: $1097.02, $1102.62/oz, $1106.04/oz, $1110.08/oz, $1114.47/oz, $1117.85/oz

Supports: $1093.29/oz, $1089.87/oz, $1085.52/oz, $1082.10/oz, $1079.30/oz, $1074.95/oz

Psychological: $1075/oz, $1100/oz

Gold Tumbles Amid Broad-Based Dollar Strength

Gold is undergoing a heavy selloff right now in reaction to a combination of a huge pullback in the Euro combined with broad-based Dollar strength after an encouraging improvement in U.S. Building Permits. Today’s rally in the Dollar has had its expected impact on gold considering their negative correlation. Losses accelerated in the precious metal after it dipped below our 3rd tier uptrend line. Meanwhile, it seems that a retest of our 1st tier uptrend line and the highly psychological $1100/oz level could be in order. Attention will now turn to China with the release of GDP and Industrial Production coming during tomorrow’s Asia trading session. Furthermore, investors will receive EU PMI data along with U.S. weekly Unemployment Claims and the Philly Manufacturing Index. Hence, volatility could remain at a heightened state for the next 24 hours. That being said, investors should keep a close eye on the interaction between gold and its highly $1100/oz level should it be tested. Furthermore, investors should take note of signs of stability in the major Dollar crosses, particularly the EUR/USD. Once the EUR/USD does create a base this should yield stability in gold as well.

Present Price: $1113.30/oz

Resistances: $1114.45, $1118.16/oz, $1121.93/oz, $1125.93/oz, $1128.42/oz, $1134.33/oz

Supports: $1111.01/oz, $1109.15/oz, $1106.04/oz, $1100.44/oz, $1096.40/oz, $11093.29/oz

Psychological: $1100/oz

Gold Holds Steady At $1,130 On Martin Luther King Day

Gold prices held steady around $1,130 per ounce on Monday, with the topside limited by firmness in the dollar, as the closure of New York markets for Martin Luther King Day kept many investors on the sidelines. 'There is a good deal of anxiety over the upcoming reporting season where the fear is that the hurdle rate is set too high and that corporates won't be able to produce top line growth,' said Mislav Matejka, European equity strategist at JPMorgan. 'However, we think that it would be wrong to write it off.' Metal prices firmed on Monday on strong Chinese demand hopes and on a weaker dollar, lifting mining shares and European equities, while the euro hit a four-month low against a broadly firmer pound. Gold is trading at $1,131 as of 20:58pm, GMT, with a bearish trend. Gold's Pool-Position is 23% Long, meaning that most Finotec clients are selling the precious metal.

Gold Walks Along our 1st Tier Uptrend Line

Gold continues to find solace in our 1st tier uptrend line amid weakness. We’ve witnessed 4 consecutive bounces on our 1st tire uptrend line this month as the EUR/USD inches higher. Gold has built a beautiful head and shoulders pattern in the process with key economic data releases on deck. We notice similar anticipation in the EUR/USD and GBP/USD as the currency pairs consolidate with trend lines converging. Hence, it seems the markets could be in for some volatility as the week wears on. The UK and U.S. will release pricing data over the next two sessions and China will highlight the week during Thursday’s Asia trading session with the release of GPD and Industrial Production. That being said, investors shouldn’t get complacent during period of relative inactivity since the markets should heat up soon.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with 1/13, 1/8, 1/5 lows. We recognize that gold has built a neckline along our 4th tier uptrend line. Hence, a movement below our 4th tier could result in a large step lower. Meanwhile, gold’s psychological $1150/oz area should continue to play a role for the near-term. As for the topside, gold faces technical barriers in the form of 1/7 and 11/18, 11/23, and 11/27 highs along with the psychological $1175/oz level.

Present Price: $1136.00/oz

Resistances: $1136.38, $1138.89/oz, $1141.39/oz, $1145.47/oz, $1148.91/oz, $1153.61/oz

Supports: $1130.43/oz, $1127.30/oz, $1124.48/oz, $1120.41/oz, $1117.27/oz, $1114.45/oz

Psychological: $1150/oz, $1100/oz, January and December highs, January lows

Gold Drifts Lower as Dollar Rallies

Gold is drifting lower today as the Dollar rallies across the board amid risk-aversion. The Dollar’s rally began during the Asia trading session after the EU released more bleak statements in regards to the state of Greece’s economy. Furthermore, the AUD/USD dropped as reality sunk in that China is tightening liquidity, cooling down the globe’s hottest economy. Additional hawkish monetary measures from China could decreases demand for Australia’s commodities and this realization dragged the Aussie lower. Meanwhile, the U.S. released sluggish Industrial Production and UoM Consumer Sentiment data. Investors reacted by sending the Cable and AUD/USD lower, a negative development for gold considering their positive correlation. However, gold is holding up relatively well despite a retreat from the risk trade today. Gold is trading above intraday lows and has bounced off our 4th tier uptrend line. However, gold could be dragged lower should the Dollar continue to rally and the S&P futures extend their intraday losses. That being said, gold still has a solid support system in place.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with 1/13, 1/8, 1/5 lows. We recognize that gold has built a neckline along our 4th tier uptrend line. Hence, a movement below our 4th tier could result in a large step lower. Meanwhile, gold’s psychological $1150/oz area should continue to play a role for the near-term. As for the topside, gold faces technical barriers in the form of 1/7 and 11/18, 11/23, and 11/27 highs along with the psychological $1175/oz level.

Present Price: $1131.75/oz

Resistances: $1136.38, $1138.89/oz, $1141.39/oz, $1145.47/oz, $1148.91/oz, $1153.61/oz

Supports: $1130.43/oz, $1127.30/oz, $1124.48/oz, $1120.41/oz, $1117.27/oz, $1114.45/oz

Psychological: $1150/oz, $1100/oz, January and December highs, January lows

Gold Gains As The Dollar Weakens And Investors Await In The ECB

Gold inched up on Thursday, keeping a bullish tone from the day before when a weaker dollar spurred short-covering and physical buying, but investors were trading cautiously before the European Central Bank's policy decision and U.S. data. Gold prices fell sharply on Tuesday when China's decision to raise bank reserve requirements sparked fears that spending would be curtailed and decrease bullion's appeal as a hedge against inflation. As the dollar remained under pressure, players shifted their immediate focus to the ECB's policy decision and remarks by ECB President Jean Claude Trichet, as well as U.S. retail sales and weekly jobless claims due later in the day. Gold is trading at $1,140 as of 8:15am, GMT, with a bullish trend. Gold's Pool-Position is 91% Long, meaning that most Finotec clients are buying the precious metal.

Gold Sinks Below $1150/oz Despite Dollar Weakness

Gold incurred sizable losses yesterday despite aggressive topside movements in both the Cable and EUR/USD. Gold’s positive correlation is a bit puzzling and could be signaling further Dollar strength to come. Meanwhile, all eyes are turning to tomorrow’s ECB meeting and the release of U.S. Retail Sales. These two events could yield volatility in the FX markets and gold would likely tag along for the ride. That being said, investors may want to disregard yesterday’s positive correlation with the Dollar. We expect gold to maintain a negative correlation with the Dollar until further notice. Hence, investors should monitor activity in the EUR/USD and Cable considering both currency pairs just broke out of their respective January highs.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with 1/13, 1/8, 1/5 lows. We recognize that gold has built a neckline along our 4th tier uptrend line. Hence, a movement below our 4th tier could result in a large step lower. Meanwhile, gold’s psychological $1150/oz area should continue to play a role for the near-term. As for the topside, gold faces technical barriers in the form of 1/7 and 11/18, 11/23, and 11/27 highs along with the psychological $1175/oz level.

Present Price: $1131.30/oz

Resistances: $1134.19, $1138.89/oz, $1141.39/oz, $1147.34/oz, $1153.61/oz, $1157.68/oz

Supports: $1130.43/oz, $1127.30/oz, $1124.48/oz, $1119.47/oz, $1114.45/oz, $1111.63/oz

Psychological: $1150/oz, January and December highs, January lows

Gold Hangs Around $1150/oz

Gold is hovering back around its psychological $1150/oz level in reaction to consolidation in the EUR/USD and GBP/USD. However, gold has gained some nice upward momentum so far this month after separating itself from the highly psychological $1100/oz area. Meanwhile, we notice trend line inflection points approaching in both the EUR/USD and GBP/USD. Hence, despite present inactivity the FX markets could be headed for some volatility. That being said, investors should monitor for any trend-setting movements in the major Dollar crosses, primarily the EUR/USD, GBP/USD, and AUD/USD, while keeping gold’s negative correlation with the Greenback in mind. The Fed will release its Beige Book tomorrow followed by key employment data from Australia during the Asia trading session. Furthermore, we’ve got U.S. Retail Sales and an ECB meeting coming on Thursday. Therefore, activity in the markets could heat up for the first time in 2010.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with intraday, 1/8, 12/30, and 12/22 lows. Meanwhile, gold’s psychological $1150/oz area could continue to play a role for the near-term. As for the topside, gold faces technical barriers in the form of 12/7 and 11/18, 11/23, and 11/27 highs along with the psychological $1175/oz level.

Present Price: $1147.20/oz

Resistances: $1153.92, $1157.68/oz, $1162.07/oz, $1165.20/oz, $1169.27/oz, $1173.66/oz

Supports: $1146.72/oz, $1143.90/oz, $1138.57/oz, $1134.50/oz, $1130.43/oz, $1126.36/oz

Psychological: $1175/oz, $1150/oz, January and December highs, January lows

Gold Continues Rally on China's Encouraging Trade Balance

Gold charged past its psychological $1150/oz level today after solid Trade Balance data from China sparked a return to the risk trade. The FX markets experienced a jolt in activity today with the Dollar selling off across the board, a positive catalyst for gold considering their negative correlation. Gold has recovered nicely from December 2009 lows and continues to build upon its 2010 momentum. However, the precious metal appears to be cooling off right now as it tops around $1160/oz, just shy of 12/8 highs. We notice similar movements in the EUR/USD and GBP/USD, meaning gold's correlative behavior is back in full swing. Meanwhile, investors are looking ahead to tomorrow's U.S. Trade Balance data. It will be interesting to see what impact this data point has on the FX markets considering the Greenback has rallied recently on positive U.S. data. Hence, solid U.S. Trade Balance data could place a speed bump in gold's current uptrend.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with intraday, 1/8, 12/30, and 12/22 lows. Meanwhile, gold's psychological $1150/oz area could serve as a technical cushion. As for the topside, gold faces technical barriers in the form of 12/7 and 11/18, 11/23, and 11/27 highs along with the psychological $1175/oz level.

Present Price: $1152.65/oz

Resistances: $1156.12/oz, $1160.50/oz, $1165.20/oz, $1168.96/oz, $1173.34/oz, $1178.36/oz

Supports: $1150.48/oz, $1146.72/oz, $1143.90/oz, $1139.51/oz, $1137.01/oz, $1130.43/oz

Psychological: $1175/oz, $1150/oz, December highs and January lows

Gold Rises in Reaction to Discouraging Jobs Data

Gold popped off what is now our 3rd tier uptrend line after U.S. Employment Change data printed weaker than analyst estimates. The pullback in employment data yielded knee-jerk selloff in the Dollar, a positive catalyst for gold since it is negatively correlated with the Greenback. However, upward momentum in the EUR/USD and GBP/USD is tempering at the moment, so investors should monitor whether the Dollar continues its downward trajectory as the trading session progresses. We wouldn’t be surprised to see the Dollar to add onto intraday losses considering the level of anticipation heading into today’s release. Investors should keep in mind that the Dollar’s December rally was triggered by a turnaround in U.S. employment data. Hence, today’s dip in employment has understandably resulted in Dollar weakness. Meanwhile, gold is staring down previous January highs with the psychological $1150/oz level hanging nearby.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with intraday, 1/05, 12/30, and 12/22 lows. On an encouraging note, gold continues to set consecutive higher lows after bottoming out in December, and we are currently unable to form a noteworthy downtrend line. Therefore, gold could have some decent upward mobility should the Dollar weaken further. As for the topside, gold faces technical barriers in the form of 12/17 and 11/18 highs along with the psychological $1150/oz level.

Present Price: $1137.13/oz

Resistances: $1138.89/oz, $1141.33/oz, $1144.84/oz, $1148.91/oz, $1153.17/oz, $1159.25/oz

Supports: $1133.56/oz, $1131.08/oz, $1128.24/oz, $1124.16/oz, $1119.47/oz, $1115.08/oz

Psychological: $1100/oz, $1150/oz, December highs and January lows

Gold Tops Out Following Solid Run

Gold is topping out below $1150/oz after a solid run despite recent weakness in the EUR/USD and GBP/USD. However, it seems gold’s usual negative correlation with the Dollar is coming back into play today. Gold is edging lower as we witness broad-based strength in the Greenback in reaction to a monetary tightening in China combined with weak data from the EU. Meanwhile, attention remains focused on tomorrow’s U.S. data set. The U.S. will release its headline Unemployment Rate and Employment Change figures. Seeing as a turnaround in U.S. employment triggered December’s Dollar rally, tomorrow’s employment data could stir up volatility in the FX markets should the numbers deviate from analyst expectations. Stronger than expected U.S employment data could encourage investors to snap up the Dollar again, normally a negative catalyst for the gold. On the other hand, discouraging employment numbers could yield broad-based weakness in the Dollar, a negative development for gold. Therefore, investors should keep an eye on the Dollar’s reaction to tomorrow’s economic data releases.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with 1/05, 12/30, and 12/22 lows. On an encouraging note, gold has set consecutive higher lows after bottoming out in December, and we are currently unable to form a noteworthy downtrend line. Therefore, gold could have some decent upward mobility should the Dollar weaken in reaction to upcoming U.S. data. Meanwhile, our 1st tier uptrend line could prove to be an important trend line since it runs through 10/28 lows, or the $1025/oz level. As for the topside, gold faces technical barriers in the form of 12/17 and 11/18 highs along with the psychological $1150/oz level.

Present Price: $1130.25/oz

Resistances: $1132.99/oz, $1137.41/oz, $1141.33/oz, $1145.40/oz, $1149.29/oz, $1153.17/oz

Supports: $1128.09/oz, $1124.03/oz, $1119.82/oz, $1115.29/oz, $1110.43/oz, $1105.57/oz

Psychological: $1100/oz, $1150/oz, December highs and January lows

Gold Pops Back Above $1100/oz

Gold is logging solid gains today as we witness broad based Dollar weakness in the FX markets today. Dollar weakness is an ideal environment for gold bulls since the precious metal has proven to be negatively correlated against the Greenback as investors head towards the risk trade. Meanwhile, investors are waiting for America’s ISM Manufacturing PMI number coming in about an hour’s time. It will be interesting to monitor the Dollar’s reaction to today’s U.S. release since investors were buying up the Greenback on positive data during the month of December. Hence, a strong Manufacturing PMI figure could temper gold’s present upward momentum. Despite today’s data release, investors are likely honing in on Wednesday’s U.S. Non-Farm Employment Change number. December’s Dollar rally was triggered by a turnaround in U.S. employment data. Therefore, Wednesday’s release could really move gold and the Dollar should the figure surprise in either direction.

Technically speaking, gold has multiple uptrend lines serving as technical cushions along with 12/31, 12/30 and 12/22 lows. On an encouraging note, gold has set consecutive higher lows after bottoming out in December and we are unable to form a noteworthy downtrend line. Therefore, gold could have some decent upward mobility should the Dollar continue to weaken. Meanwhile, our 4th tier uptrend line could prove to be an important trend line since it runs through 10/28 lows, or the $1025/oz level. As for the topside, gold faces technical barriers in the form of 12/17 highs along with the psychological $1150/oz level.

Present Price: $1117.55/oz

Resistances: $1117.80/oz, $1122.70/oz, $1128.09/oz, $1132.99/oz, $1137.41/oz, $1141.33/oz

Supports: $1110.94/oz, $1104.83/oz, $1100.55/oz, $1096.27/oz, $1092.91/oz

Psychological: $1100/oz, $1150/oz, December lows