• FxWirePro: Gold trades lower strong USD, good to sell on rallies

    Source: FxWire Pro - Technicals / 20 Jun 2018 03:55:53   America/New_York

    • Gold prices has shown a $10 dip yesterday after a minor consolidation. The yellow metal jumped slightly till $1283.95 yesterday and hits 5 month low at $1270. The major reason for huge decline in gold is due to strong US dollar index. The yellow metal declined more than $25 in previous week. US dollar was trading high against all majors after more hawkish Fed. The slight divergence in Fed and ECB is dragging Euro lower. US 2 –year bond yield recoverd slightly from low of 2.49% and is curretly trading around 2.56% and 10 year yield is trading steady after declined slightly till 2.85% after hitting 3%. The trade tension between US and China is dragging USDJPY slightly lower .USDJPY has declined almost 150 pips from high of 110.90. It is currently trading around 109.88. The yellow metal hits low of $1275 yesterday and is currently trading around $1274.
       
    • The major three factors to be watched for gold price movement are
    1. US Dollar index – Strong  (negative for gold)
       
    2. USDJPY- Slightly positive   (slightly positive for gold)
       
    3. US 10 –year yield – 2.90% (0.02% for the day (neutral for gold)

     

    • The yellow metals near term resistance at $1307 (200- day MA) and any convincing close above will take the yellow metal till $1316 (55- day EMA)/ $1324 (50% fibo).The minor resistance is around $1296 (20- day MA). 
       
    • On the lower side, near term support is around $1280 and any break below will drag the yellow metal down till $1275/$1269/$1260

      ​It is good to sell on rallies around $1278-80 with SL around $1286 for the TP of $1269/$1260.

     

     

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