A combination of peace and stronger dollar saw Gold with a big sell-off Tuesday closing just above the days lows. While inflation pressures elsewhere proved to be a boon for the US dollar we note that Gold is actually the traditional asset used to hedge against rising prices. As such we could see the yellow metal diverge from other assets with today’s FOMC release as a hawkish Fed will actually be good for Gold. Still the key issue here is middle east conflict and prospects of a ceasefire will likely determine if we bounce or ease further from here.
Resistance
- 2352.54 – Daily Low / High
- 2311.67 – Daily Range Play Floor
- 2293.32 – Intraday Consolidation Resistance
Support
- 2265.98 – Daily Lows
- 2250.43 – Intraday Consolidation Floor
- 2227.70 = 50D Moving Average
We have Gold starting a fresh down leg with its break of the accelerated trend line from February 29. The move has taken us below a previous daily consolidation low with daily oscillators now poised to reenter the oversold area. Given the daily close immediate risk for us will be to see a follow through to the sell-off with long wicks from the resistances an immediate excuse for jumping short. Technically we should be looking for things to head to the 50D moving average though any flare up in the middle east could quickly see a bounce and a broader range play in the daily charts.
