By Fast Brokers – Gold is fluctuating wildly today as investors react to the stronger than expected U.S. data set. U.S. GDP, Chicago PMI, and UoM Consumer Sentiment data all printed stronger than analyst expectations. While investors have reacted by buying up the Dollar and selling gold, the precious metal has been all over the place on the 1-hour and it seems investors are debating exactly how to play today’s development. The outperformance in U.S. economic data has led investors to favor the Dollar as a safe haven amidst global economic uncertainty, a negative for gold considering correlative forces. On the other hand, a boost in U.S. economic activity could also prove to be a positive development for the risk trade. Hence the wild fluctuations in gold so far this session. That being said, it seems the downside is winning the battle thus far, though we will have to wait and see how the session plays out. Meanwhile, investors should keep an eye on the major Dollar pairs should there be another considerable technical move.
Technically speaking, gold has our 1st tier uptrend line serving as a technical cushion along with January lows should they be tested. Our present uptrend lines run through August 2008 levels, highlighting the significance of the moment. 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: $1078.05/oz
Resistances: $1078.92/oz, $1085.32, oz, $1090.07/oz, $1093.32/oz, $1096.91/oz, $1101.00/oz
Supports: $1074.44/oz, $1070.65/oz, $1063.28/oz, $1058.74/oz, $1054.86/oz, $1050.12/oz
Psychological: $1075/oz, $1100/oz, January lows
Market Commentary provided by Fast Brokers.
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