Gold Drops To Three Month Low Below $1160
MarketPulse | Jul 03, 2015 12:55AM ET
Gold – Friday, July 3rd, 2015
Throughout the last couple of weeks, gold has steadily declined and fallen from above the key $1200 level back to below $1160 and a three month low. Earlier this week, 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 couple of weeks, gold has been content to trade around the key $1180 level. A few 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 recent exception. 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 3 at 00:45 GMT 1166.3 H: 1170 L: 1157.1
Gold Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1150 | — | — | 1200 | 1240 | — |
During the early hours of the Asian trading session on Friday, gold is trading in a narrow trading range right above $1165 after recently falling sharply from above $1180. Current range: trading right above $1165.
Further levels in both directions:
Get The News You Want
• 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 surged back up above 80%, as gold has fallen sharply back to below $1160. The trader sentiment is strongly in favour of long positions.
Economic Releases
- 01:30 AU Retail trade (May)
- 08:00 EU Composite PMI (Jun)
- 08:00 EU Services PMI (Jun)
- 08:30 UK CIPS / Markit Services PMI (Jun)
- 09:00 EU Retail Trade (May)
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