Gold – Continues to Consolidate around $1180

Gold – Monday 15 June 2015

In the last couple of weeks gold has been content to trade around the key $1180 level which is where it presently sits.  During last week 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.  A few weeks 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 June 15 at 01:20 GMT   1182.9   H: 1186.6   L: 1180.7

Gold Technical

During the early hours of the Asian trading session on Monday, Gold continues to trade in a very narrow range just above $1180. Current range: trading right above $1180.

Further levels in both directions:

• Below: 1180 and 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 moved back above 70% again as Gold has consolidated around $1180. The trader sentiment is strongly in favour of long positions.

Economic Releases

• 09:00 EU Trade Balance (sa) (Apr)
• 12:30 CA Manufacturing sales (Apr)
• 12:30 US Empire State Survey (Jun)
• 13:15 US Capacity utilisation (May)
• 13:15 US Industrial production (May)
• 14:00 US NAHB Builders survey (Jun)
• 20:00 US Net Long-term TICS Flows (Apr)

* All release times are GMT

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