Gold Continues To Enjoy Support From $1150

 | Jul 15, 2015 01:22AM ET

Gold – Wednesday, July 15th, 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. In the last few days, it has rallied higher, but run into resistance at $1160, which has sent it lower again back towards $1155. To finish 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 15 at 02:30 GMT 1155.9 H: 1157 L: 1155

Gold Technical

S3 S2 S1 R1 R2 R3
1150 — — 1200 1240 —
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During the early hours of the Asian trading session on Wednesday, gold is easing back towards $1155, after making another run at $1160. Current range: trading right above $1155.

Further levels in both directions:

• Below: 1150.

• Above: 1200 and 1240.

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