3 May 2016
Gold turns lower as dollar strengthens
Gold prices surged at the beginning of the day, but the greenback’s comeback seen during the American afternoon sent the commodity into the red, with spot down to a fresh weekly low of $1,282.13 an ounce before settling around 1,286.50.
The intraday decline was also blamed on dull psychical demand from China and India, with overall physical buying down 23.8% during the three months to March and compared to Q1 2015, down to 781 tons, from 1,025 tons last year.
Gold technical view
“Spot's daily chart shows that the bright metal remains at its highest since late January and well above a bullish 20 SMA, while the technical indicators have lost upward strength and turned south, holding however, near overbought territory,” said Valeria Bednarik, chief analyst at FXStreet.com. “In the 4 hours chart, the commodity is currently trading below a bullish 20 SMA, whilst the technical indicators have turned flat around their mid-lines, following a retracement from overbought territory, suggesting the latest decline has been corrective. A break below 1,283.50, however, should lead to a bearish continuation this Wednesday that can extend down to the 1,261/64.00 region”.
Support levels: 1,283.50 1,271.10 1,262.30 Resistance levels: 1,290.85 1,297.10 1,308.40.
The intraday decline was also blamed on dull psychical demand from China and India, with overall physical buying down 23.8% during the three months to March and compared to Q1 2015, down to 781 tons, from 1,025 tons last year.
Gold technical view
“Spot's daily chart shows that the bright metal remains at its highest since late January and well above a bullish 20 SMA, while the technical indicators have lost upward strength and turned south, holding however, near overbought territory,” said Valeria Bednarik, chief analyst at FXStreet.com. “In the 4 hours chart, the commodity is currently trading below a bullish 20 SMA, whilst the technical indicators have turned flat around their mid-lines, following a retracement from overbought territory, suggesting the latest decline has been corrective. A break below 1,283.50, however, should lead to a bearish continuation this Wednesday that can extend down to the 1,261/64.00 region”.
Support levels: 1,283.50 1,271.10 1,262.30 Resistance levels: 1,290.85 1,297.10 1,308.40.