By Fast Brokers – Gold has recovered from intraday lows, avoiding a retest of Tuesday lows and climbing back to its highly psychological $1100/oz level in the process. With gold hovering around $1100/oz, the precious metal is sending a message that the markets could be at a critical juncture. The EUR/USD is also trading around 1.35 and the Cable 1.50. Hence, psychological forces are in play across the board with key EU and U.S. economic data on the way. Additionally, the UK will release its long-awaited budget tomorrow followed by the EU’s highly anticipated meeting at the end of the week. Therefore, there are plenty of potential psychological influences in the mix, with Greece in focus. Although a plan for financial assistance is becoming less likely by the day, should the EU surprising by production a solution this could be a boon for the risk trade, gold included. However, weak economic data coupled with a disappointing EU meeting could weigh down on gold and favor the Dollar further. Hence, investors should pay close attention to headlines and the data wire for upcoming developments. Meanwhile, the highly psychological $1100/oz level could continue to have an influence on the precious metal until the markets send a new directional message.
Technically speaking, gold has intraday and Tuesday lows serving as technical cushions along with the highly psychological $1100/oz area. As for the topside, gold faces multiple downtrend lines along with intraday, March 22nd and March 3rd highs.
Present Price: $1099.70/oz
Resistances: $1101.50/oz, $1103/oz, $1104.90/oz, $1106.20/oz, $1108.50/oz
Supports: $1098.30/oz, $1096.30/oz, $1094.90/oz, $1094.10/oz, $1092.30/oz
Psychological: $1100/oz, March highs and lows
(click chart to enlarge)
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