Gold prices are hanging by a thread. Technical support at $1,204 per toz. has held on but barely,as market participant optimism has strengthened the yellow metal’s decent.
A close below $1,204, gold prices are likely to test lower support between $1,185 and $1,190 per toz. Gold has seen a large pullback after momentum above $1,300 waning. The four-hour chart of XAUUSD , a forex representation of gold priced in dollars, is showing price action teetering on the ascending trend created at $1,151 per toz. on November 30.
If prices can stay supported, prices could move higher to $1,213/17. Higher resistance is seen at $1,224.
$1,204 remains a focal price level. It remained a key last year, preventing prices to substantially move past $1,200 during the later half of 2014.
But, hey! What's not to be happy about ever-decline economic data, SPX over 2,100, increased geopolitical tensions, and the risk of deflationary spawned QE?