By Fast Brokers – Gold is staging a rally during the Asia trading session as investors await key EU economic data and the Fed’s monetary policy decision later today. Gold was a beacon of stability during yesterday’s risk-averse movement in the FX markets. The precious metal continued its consolidation above $1100/oz and is currently moving in line with its negative Dollar correlation despite last week’s deviation. However, although gold’s pop is encouraging, it still needs to surpass our 1st and 2nd tier downtrend lines along with 3/12 highs before establishing a more sustainable recovery. After all, the precious metal did dip below $1110/oz and some key uptrend lines last week during its pullback. Should EU data print strong and the Fed stick to its loose monetary policy for the foreseeable future gold could find enough strength to overcome its topside technical barriers. On the other hand, should data disappoint and the Fed tighten its language then gold could come under selling pressure again. On the other hand, gold hasn’t exactly been behaving according to its past correlation patterns as of late, so analyzing gold according to its usual correlative forces could be a mistake. Either way, gold and FX markets could experience heightened activity over the next 24 hours as investors digest the wealth of news and data.
Technically speaking, gold faces multiple downtrend lines along with 3/12and 3/10 highs. As for the downside, gold still has multiple uptrend lines serving as technical cushions along with intraday, 3/15, and 3/12 lows. Furthermore, the psychological $1100/oz area could continue to have an influence on gold over the near-term.
Present Price: $1113.30/oz
Resistances: $1113.77, $1115.19, $1116.32/oz, $1117.66/oz, $1118.87/oz, $1120.77/ oz
Supports: $1112.30/oz, $1111.13/oz, $1110.06/oz, $1109.09/oz, $1108.17/oz, $1106.94/oz
Psychological: $1100/oz, $1150/oz, March highs and Lows
(click chart to enlarge)
Market Commentary provided by Fast Brokers.
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