Gold futures finished the session a hair under 1250.0 an ounce Wednesday settling at 1249.7. Today’s settle puts the yellow metal up $19.70 for the week so far and the rally can be mostly attributed to safe haven buying in my opinion. S&P and Dow futures have suffered their worst weekly losses of 2017 this week, with technicians warning of a downside breakout for both indexes on the charts. The reason for the recent weakness stems from increased investor sentiment of the President’s health care law failing passage in both the House and Senate. The failure to repeal and replace Obama care would raise eyebrows on other expected pieces of legislation regarding corporate tax and other pro business initiatives that some investors have already priced in. The continuation rally that started prior to the Fed meeting in Gold continues to need to be fed by risk off sentiment in stocks, amid geo-political events and global economic uncertainties going forward. Given the uneasiness and unpredictability of the current administration in Washington, that without a return to previous all-time highs in equities, that any future dips in Gold and Silver going forward will be seen as buying opportunities.
Technically, support for April gold comes in for the remainder of the week at 1243.8 and with a close under, next support sits at 1220.3. Resistance is up at 1257.3, and then 1264.9. A close over here sets up 1288.0 as the next target to the upside.
For those interested I hold a weekly grain webinar each Thursday at 3pm. It is free for anyone who wants to sign up and link for sign up is below. If you cannot attend live a recording will be sent to your email upon signup.
Sean Lusk
Director Commercial Hedging Division
Walsh Trading
312 957 8103
888 391 7894 toll free
312 256 0109 fax
slusk@walshtrading.com
Walsh Trading
53 W Jackson Suite 750
Chicago, Il 60604