Gold Consolidates As Investors Await Global Data

Gold is following the consolidation of the Dollar and U.S. equities while ignoring the pop in crude.  The precious metal seems range bound for the immediate-term as investors await the heavily-weighted economic data coming later in the week.

Gold has logged larger volume on its down-bars than up-bars on the 1-hour during its upswing beginning dating 6/23, while volume on the 4-hour has been rather tame.  Therefore, the present upturn of gold has been limited to a sub-$950/oz reality.  As a result, the near-term momentum is tilted in favor of the bears as the GBP/USD and EUR/USD fight near-term downtrends of their own.  The overall behavior of gold reflects that of the market as a whole with investors uncertain whether to bank on a global economic recovery or a new leg down.  We expect volatility to pick-up beginning late Tuesday/Wednesday with key unemployment, housing, and manufacturing data pouring in from around the globe along.

Additionally, the ECB will make a monetary policy decision on Thursday.  Hence, while gold may be subdued for the immediate-term, investors shouldn’t get too complacent.  The near-term key for gold to the downside will be holding 6/15 and 6/16 lows.  Important near-term barriers to the upside are our 1^st and 2^nd tier downtrend lines along with 6/26 highs.

Present Price: $935.60/oz

Resistances: $936.01/oz, $939.02/oz, $941.85/oz, $943.88/oz, $945.75/oz

Supports: $932.48/oz, $929.77/oz, $927.98/oz, $$925.24/oz, $923.59/oz

Psychological: $900/oz, $950/oz

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