Gold Prices Trade to Three Month High

Gold prices traded dramatically higher today, moving to a price point not seen since November 11, 2016. As of 4 o’clock Eastern standard time gold futures (April 2017 contract) were up 16.6 dollars at $1237.50

Multiple factors were cited as supportive of higher gold prices. Statements made by Frances National Front Leader Marine Le Pen, in which she was supportive of a Brexit style exit from the European Union was one factor supportive of gold pricing.

Also, statements made by an economist at Goldman Sachs was supportive of gold prices. “The catalyst for the rally is cautious comments from a Goldman Sachs economist regarding concerns over implementation of policies and the fact they differ from the platform President Donald Trump was elected on.” This according to Joel Elconin Staff Writer at Behzinga.

Although multiple factors influenced today’s dramatic rise in gold prices, the US dollar was not one of them. Based upon the Kitco gold index spot gold traded $15.70 higher on the day, with a strong US dollar deducting $2.20 from that total. The net change on the day was spot gold trading up $13.50.

Money managers Join the Party

The most recent COT report (commitment of traders) which was released on Friday, showed that as of January 31, money managers had increased their speculative long gold positions.

As we have spoken about on many occasions, it seems as though there are multiple factors that when combined form the necessary ingredients for a perfect storm scenario in gold. Ever since gold prices traded to a low of $1120.00 per ounce in December 2016 they have not backed down and have traded dramatically higher off of that price point.

Based upon our technical studies we see no real resistance until $1242, with the potential for major resistance at $1281 per ounce. Our studies also indicate technical support at $1220 and $1183 per ounce.

Wishing you as always, good trading,