By Fast Brokers – Gold has logged solid gains today, popping above weekly highs in the process. Gold appears to be following today’s large leg up in the EUR/USD in reaction to positive EU economic data. Germany’s employment picture improved while Flash CPI climbed to 1.5%. Rising prices and improving employment creates a more favorable environment for the ECB considering recent instability brought on by Greece. Hence, investors are beginning to gain more confidence with the EU, a positive for the risk trade and gold considering its usual negative correlation with the Greenback. However, the EUR/USD and Cable still face their fair share of near-term topside barriers. Meanwhile, gold has reacted positively to the disappointing U.S. economic data thus far. Chicago PMI and the ADP figure both came in below analyst expectations, reminding us of the fact that America’s economic recovery is occurring at a sluggish pace. Investors have sold the Dollar in reaction, a positive for gold during correlative forces. However, we will have to see how the remainder of the trading session plays out. Investors will receive a stream of key data throughout tomorrow’s trading session, highlight by Manufacturing PMIs from Japan, China, the UK, and the U.S. Hence, tomorrow could prove to be an active day.
Technically speaking, gold has multiple downtrend lines serving as technical barriers along with intraday and 3/18 highs. As for the downside, gold now has multiple uptrend line serving as technical cushions along with 3/29 and 3/30 lows. Additionally, the $1100/oz level could continue to have an influence on price over the near-term.
Present Price: $1114.60/oz
Resistances: $1115.96/oz, $1117.18/oz, $1119.10/oz, $1120.33/oz, $1121.47/oz
Supports: $1114.55/oz, $1112.71/oz, $111.39/oz, $1110.25/oz, $1109.02/oz, $1108.15/oz
Psychological: $1100/oz, March highs and lows
(click chart to enlarge)
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