Both Gold and Copper sought new levels on Friday and continued their volatility on Monday.
On Friday Gold was up by 1.3%, keeping up its 3 day rally on Monday to increase to a near 2-week high. Losses on the U.S dollar and the dovish statement from the FED on interest rate hikes, pushed investors to the so-called safe haven. After initial claims that the FED may push an interest rate in June, a poll by Reuters now shows that most Wall Street banks do not expect the rise to happen until at least September.
Analysis from STOCK.com puts the Gold Day Trading Strategies as follows:
Bullish scenario: Long positions above the daily pivot point 1180.00$ with targets at 1192.00$ next 1199.50$ in extension.
Alternatively, Bearish scenario: Short positions below the daily pivot point 1180.00$ with targets at 1172.50$ next 1160.50$ in extension.
The STOCK.com Daily Chart Support and Resistance levels for Gold are as follows:
Resistance: 1190.00, 1223.00, 1236.00, 1240.00, 1245.90
Support: 1160.00, 1140.00, 1132.00, 1120.00, 1100.00
The four-month low for Gold seen before the FED statement last week was due to fears over a high interest rate being announced soon; this would subsequently impact unfavourably on gold as it does not pay interest to investors and is linked to the U.S dollar that would be expected to fall.
Meantime, the copper market is seeing volatility due to markets reacting to the stoppage of work and production at the world’s biggest copper mine in Indonesia. Grasberg had been shut since 16 March by protesting miners from the production company Freeport-McMoRan. Inventories were still being shipped out though output had stopped. The blockage reportedly finished on Saturday after 5 days. However, the impact was felt in the Copper market on Friday, with the commodity up 10 cents or 3.63%, closing at 2.7553. By Monday there had been little change 2.7678, but by then it was at its highest level in two months.
MT4 Chart: XAUUSD [Gold]
MT4 Chart: Copper
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