Gold – Monday, July 13th, 2015
Throughout the last few weeks, gold has steadily declined and fallen from above the key $1200 level back to a new three month low below $1150 last week. It has, however, enjoyed some solid support from the $1150 level throughout last week, which stopped the sharp falls for the moment and allowed it to rally a little higher up to above $1160, which is where it presently sits. To close out a couple of weeks ago, it was able to rally against the medium term down trend and move back above the $1170 level before easing off again. A couple of weeks ago, it surged higher to back above the key $1180 level, before easing lower again. In the few days prior, gold had been easing back to below the key $1200 level after recently surging higher to a three week high above $1205.
The $1200 level remains significant, and is continuing to place selling pressure on gold and likely the $1180 level now too. Prior to the surge, and in the last few weeks, gold has been content to trade around the key $1180 level. Several weeks ago, it rallied well to move from a two month low near $1160 back up to above $1190 again, before easing back to the $1180 level. The key $1180 level has consistently provided solid support and has held it up now for a couple of months, with the exception of the recent excursion below. About a month ago, gold fell sharply back through the key $1200 level, and spent the remainder of that week consolidating in a narrow range around $1190. The $1200 level has been a significant level throughout most of this year, and remains a key level presently, offering reasonable resistance to higher prices, whilst lower, the $1180 level continues to be significant. Throughout the last month or so, the $1180 level has provided some support and has been called upon recently.
Earlier in May, it was able to make a run through the $1200 level to reach a three month high above $1230; however, gold was quickly sold off and returned back to the $1200 level, where it enjoyed some support for several days. For around two months, through April, gold traded in a range between $1180 and around $1220, and had very few excursions outside these limits. Gold is currently pinned between resistance at $1200 and support at $1180, and it is surprising to see it trade in such a narrow range for several days. It seems it is waiting patiently for external factors to determine which level will be severely tested next.
(Daily chart / 4 hourly chart below)
Gold July 13 at 03:00 GMT 1161.3 H: 1165.1 L: 1160.8
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1150 | — | — | 1200 | 1240 | — |
During the early hours of the Asian trading session on Monday, gold is trading in a narrow range right above $1160, after having benefited greatly from solid support around $1150. Current range: trading right above $1160.
Further levels in both directions:
• Below: 1150.
• Above: 1200 and 1240.
OANDA’s Open Position Ratios
(Shows the ratio of long vs. short positions held for gold among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The long position ratio for gold has eased back to just under 80%, as gold has rallied back up a little to above $1160. The trader sentiment is strongly in favour of long positions.
Economic Releases
- 04:30 JP Capacity Utilisation (May)
- 04:30 JP Industrial Production (Final) (May)
- 13:00 EU Euro-Area Finance Ministers Meet in Brussels
- 18:00 US Budget (Jun)
- WLD OPEC release monthly oil market report