Gold prices moved higher as USD weakness persists

6:58 PM

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Gold prices moved higher as USD weakness persists

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GOLD moved marginally higher in overnight trade as USD weakness per-sists and equities gained ground even after a weaker than forecast reading on GDP and Unemployment Claims data. Gold finished US trade higher by $5 at $1,535. Our target earlier this month at $1,540/50 has pretty much been reached and that is why we have turned neutral in the extreme short-term.

We remain medium-term bulls and expect prices to hit new record highs above $1,600 by the end of June. We see some consolidation in the short-term and we have locked in our profits and prefer now to buy into weakness. We would look to re-enter this trade on dips back towards $1,475. We may not see this pullback and if we continue through $1,550 we will re-enter a long position.

Compass Direction – NEUTRAL

3rd Support 2nd Support 1st Support SPOT 1st Resistance 2nd Resistance 3rd Resistance

$1,509/10 $1,517/18 $1,525 $1,536 $1,538/40 $1,550 $1,561/62

AUS 200 finished US trade only marginally higher last night as commodities consolidated. It is surprising that we did not see a higher close on the futures and we continue to see an underperformance by Australian equities over US equities.

The AUS 200 finished US trade stronger by only 2 points at 4,875. We remain bullish, however, it is start to become a concern that we continue to underperform both regional and offshore equity markets this week.

The stronger than forecast CPI reading earlier this week seemed to be the catalyst and potentially higher interest rates coupled with a strong AUDUSD could see investors park there money elsewhere or in alternative markets to equities. Only a close below 4,840 will negate our bullish stance. Resistance remains at 4,900.