Gold Focused On Higher Prices

(March 5, 2020 - Blue Line Futures)
Featuring views and opinions written by market professionals, not staff journalists.

Yesterday’s close: Settled at 1643, down 1.4

Fundamentals: Gold is higher by almost 1% this morning as weakness makes its way back into the risk landscape. Treasuries are higher and the Dollar is again lower; this is a perfect mix for Gold, however, traders still must be cautious given the metal’s previous rout upon sharp selling the equity markets. We remind you of this because of the budding failure in equities (see S&P section for levels of affirmation). Initial Jobless Claims and Nonfarm Productivity both came in a shade below expectations and we now look to January Factory Orders at 9:00 am CT. Ultimately, Nonfarm Payroll is due tomorrow and we expect this to cause definitive action on the week.

Technicals: Our momentum indicator aligns well with the 1642.9-1644 Pivot which is also exactly where Gold settled yesterday. The move out above 1654 this morning is firm and eludes to a higher tape, however, we do have major three-star resistance at 1662.5, aligning with a previous failure and this keeps us only cautiously optimistic in the near-term but of course unequivocally Bullish in Bias over the longer-term. A failure to close above 1642.9-1644 would be very disappointing, pointing to a near-term failure.