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FxWirePro: Gold recovers sharply on renewed geo political tensions, good to buy on dips

 

  • Gold has rallied sharply on Friday after weaker than expected US jobs data. US economy lost almost 33k jobs in previous month compared to forecast of 90000 addition of jobs on account of hurricane Harvey and Irma. But unemployment rate was at 4.2 %at 16 – year low and hourly wages also increased to 2.9%. The yellow metal jumped sharply from the low of $ 1260.47 and jumped till $1284.45. It is currently trading around $1282.88 0.51% higher.
  • North Korea is preparing to test a long range missile reported by Russian Lawmaker. Gold prices are supported by renewed North Korea tensions.
  • US Dollar index has shown a minor weakness after hitting a high of 94.27 on Friday. It is currently trading around 93.77. The pair is facing major support near 23.6% (93) and any break below confirms minor weakness. The near term resistance is at 94.45 (50% fibo) and any break above will take the index to next level till 95.
  • U.S 10 year yield has declined slightly after hitting high of 2.40% after slightly weaker than expected US jobs data
  • Technically gold is facing major resistance around $1287 (55- day EMA) and any break above will take the yellow metal till $1296 (50- day MA)/$1302/$1309 (daily Kijun-Sen)
  • Gold’s near term support is around $1262 (61.8% retracement of $1204 and $1357.90) and break below will drag the commodity down till $1250 (200- day MA).The yellow metal should close below $1250 for major trend reversal. The near term support is around $1276 (10- day MA).

It is good to buy on dips around $1275-$1277 with SL around $1268 for the TP of $1287/$1295.

 

Our chart for the call:

 

 

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