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Gold To Continue Ranging

Gold traded in a near $20 an ounce range between $1740.00 and $1760.00 an ounce overnight but ultimately settled almost unchanged for the day at $1752.50 an ounce. Some weekend risk-hedging by Asian investors has lifted gold by a modest 0.20% to $1756.00 an ounce today.

The yellow metal staved of US Dollar strength overnight to the relief of gold bugs, even if that capped its intra-day rally. Weekend risk-hedging should support the metal into the close of the week. That said, the balance between buyers and sellers looks more even today, and after Monday morning’s early flash-crash, I doubt investors will have the nerve to go into the weekend heavily long.

Baring a sharp move higher by the US Dollar in New York, it should leave gold roughly contained between immediate support/resistance at $1840.00 and $1860.00 an ounce. Intermediate support lies at $1725.00 with the $1800.00 to $1805.00 region a formidable resistance zone.

Given the horror of last Monday’s flash-crash and given the Fed tapering noises grow louder by the day, lifting the US Dollar, it is hard to see gold powering higher from here. More than likely, the nervous FOMO long-positions initiated on Wednesday are likely to cut and run at the first sign of trouble.

 

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