By Fast Brokers – 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
Market Commentary provided by Fast Brokers.
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