Gold saw a sharp sell-off following the release of the US FOMC minutes suggesting a shift in bias among its member and more delays in US easing. The sharp drop to us suggests that despite the talk of demand from Central Banks for the yellow metal, the latest surge is not about hedging against inflation but mostly speculative, using cheaper financing for trades. There has been little change in the geopolitical front and inflation has indeed eased from where we were six months ago.
Resistance
- 2397.90 – Previous Consolidation High
- 2371.11 – Previous Consolidation Low
- 2358.75 – Yesterday’s High
Support
- 2347.41 – Previous Intraday Consolidation Resistance
- 2325.48 – Pullback Low
- 2317.14 – 50D Moving Average
XAUUSD charts are interesting as we face the 50D Moving Average under the pullback lows and daily indicators suggests a we look for a bounce as stochastic come off oversold levels. Intraday the picture changes with an overbought stochastic and mostly tight average true range suggesting vulnerability. For now we will call for a straddle with buys on a break of 2358.75 and sell’s should 2347.41 give way suggesting we look for a weekly scale double top, see at bottom.
