Gold Creeping Back Towards $1200

 | May 25, 2015 12:24AM ET

Gold for Monday, May 25, 2015

Over the last week, gold has slowly but surely drifted lower back to the key $1200 level where it is presently consolidating above. In the week prior, gold enjoyed a solid week surging to a three month high above $1225, before returning most of those gains easing back to and enjoying support from around the key $1200 level. A few weeks ago, gold enjoyed support at $1180, which allowed it to rally back to $1190 and beyond to resistance at $1200. Several weeks ago, gold fell sharply back down through the key $1200 level down to below another support level around $1180, before dropping further to a six week low below $1170. To start that week, gold was trying to rally higher and regain lost ground from the end of the previous week, which saw it drop to near $1175. Over the last couple of months, gold has had an attraction to the key $1200 level, as every time it ventures away, it returns quickly to trade right around it.

Back at end of March, gold eased a little for a few days to below $1185, although for the best part of the last few weeks, gold has moved strongly off the support at $1150 and then found some new support from the $1200 level. Throughout the second half of February, gold enjoyed rock solid support from the key $1200 level, which held it up on numerous occasions. For about a month, gold drifted steadily lower down to a one month low near the key $1200 level, before finding the solid support at this key level. At the beginning of December, gold eased lower away from the resistance level at $1240, yet again back down to below $1200. During the second half of November, gold made repeated runs at the resistance level at $1200, failing every time, before finally breaking through strongly. Throughout the first half of November, gold enjoyed a strong resurgence back to the key $1200 level, where it has met stiff resistance up until recently.

Throughout the second half of October, gold fell very strongly and resumed the medium term downtrend, falling from above $1250 back down through the key $1240 level, down below $1200 to a multi year low near $1130. It spent a few days consolidating around $1160 after the strong fall, which has allowed it to rally higher in the last couple of weeks. Earlier in October, gold ran into the previous key level at $1240; however, it also managed to surge higher to a five week high at $1255. In late August, gold enjoyed a resurgence, as it moved strongly higher off the support level at $1275. However, it then ran into resistance at $1290. In the week prior, gold had been falling lower back towards the medium term support level at $1290; however, to finish out last week, it fell sharply down to the previous key level at $1275.

(Daily chart / 4 hourly chart below)

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Gold May 25 at 01:05 GMT 1204.2 H: 1206.1 L: 1203.5

Gold Technical

S3 S2 S1 R1 R2 R3
1200 1180 1150 1240 1300 —

During the early hours of the Asian trading session on Monday, gold is consolidating right around $1205 after its testing of support around $1200 over the last couple of days. Current range: trading right below $1205.

Further levels in both directions:

• Below: 1200, 1180 and 1150.

• Above: 1240 and 1300.

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