Gold breaks trend line support, dip till $1308 likely
Trend line support - $1330
Gold declined almost $19 from high of $1343.80 made yesterday. The yellow metal halted its one month rally as dollar recovers from 3 year low. US dollar index has shown a minor recovery of 100 pips from the low of 90.11. The yellow metal hits low of $1324.15 and is currently trading around $1328.
US 2- year yields hits 2008 high at 2.043% after better than expected U.S industrial production. U.S industrial production came at 0.9% in Dec compared to forecast of 0.4%. U .S 10 –year bond yield raised till 2.58% from the low of 2.55%. Any break above 2.62% confirms bullish continuation. U.S bond yields and gold price are inversely correlated.
The near term support is at $1324 (233- H MA) and any violation below will drag the metal to next level till $1320 (61.8% fibo)/$1313/$1308 (Jan 10th low). Minor weakness below $1300. Any break below $1300 will drag the gold till $1287.
On the higher side near term resistance is around $1352 (trend line joining $1433 and $1375) and break above targets $1357/$1375
It is good to sell on rallies around $1328-$1330 with SL around $1338 for the TP of $1314/$1309.
Gold declined almost $19 from high of $1343.80 made yesterday. The yellow metal halted its one month rally as dollar recovers from 3 year low. US dollar index has shown a minor recovery of 100 pips from the low of 90.11. The yellow metal hits low of $1324.15 and is currently trading around $1328.
US 2- year yields hits 2008 high at 2.043% after better than expected U.S industrial production. U.S industrial production came at 0.9% in Dec compared to forecast of 0.4%. U .S 10 –year bond yield raised till 2.58% from the low of 2.55%. Any break above 2.62% confirms bullish continuation. U.S bond yields and gold price are inversely correlated.
The near term support is at $1324 (233- H MA) and any violation below will drag the metal to next level till $1320 (61.8% fibo)/$1313/$1308 (Jan 10th low). Minor weakness below $1300. Any break below $1300 will drag the gold till $1287.
On the higher side near term resistance is around $1352 (trend line joining $1433 and $1375) and break above targets $1357/$1375
It is good to sell on rallies around $1328-$1330 with SL around $1338 for the TP of $1314/$1309.
