Gold Rate Today, Gold Price – Gold spikes on US jobless claims on Thursday; exit all long positions below 59,000- Gold Price Forecast, Gold Price Outlook

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By Bhavik Patel

Strong intraday rally was seen yesterday in gold after US unemployment came higher than expected. US unemployment claims came at a two year high which is highly supportive of rate pause. US Dollar and Treasury yields both dip after the data and bullions jumped. Market is now waiting for next week’s PCE index on 13th June and FOMC meet on 14th and 15th. Many investors were surprised by the rate hike from the Bank of Canada and Australia which brings the reality that pause does not mean shift from pivot as Bank of Canada raised rates after four month pause.

The demand from central banks continues to remain high as China stretched its gold buying spree into the 7th straight month in May. Many of the central banks in bid to de-dollarize have been buying gold into their reserves. Demand for gold in the first quarter in India was down by 17 percent due to high prices. However the trend might change in the last quarter of the current year when the festive and wedding season will kick in. If the economy is slow during that period, then safe haven appeal may also attract physical gold buying.

Gold: Technical Outlook

Head and shoulder pattern is forming on the daily chart with neckline support coming around 59,000. So we could assume that trend reversal will form below 59,000 on a closing basis. Momentum oscillator RSI_14 is neutral around 48 with no divergence. 59,000 is the level one can watch and hold long position with stoploss as not only Head and Shoulder neckline comes around that level but Fibonacci retracement (61.8%) taken from highs of 61,845 and lows of 54,771 also comes around 59,140. Below that, next support for gold rate emerges around 58,300 where 50% retracement is.  

On the higher side, 60,400 is the immediate resistance for gold price where last week’s swing high and 78.6% retracement is. Any correction near 58,400-58,200 would be a buying opportunity with a stop loss of 59,000 and target of 60,100. However any long positions should be exited below 59,000 and wait for further bottoming out around next support of 58,300.

(Bhavik Patel, Commodities and Currencies Analyst, Tradebulls Securities. Views expressed are author’s own. Please consult your financial advisor before investing.)


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