Gold Climbs to $1613 Before Reversing | The Gold Forecast

Gold Climbs to $1613 Before Reversing

January 8, 2020 - 5:52pm

 by Gary Wagner

After 10 consecutive trading days which resulted in daily gains and a higher closing price when compared to the open that streak was broken today when gold futures settled sharply lower on today. The price difference between Tuesday evening’s high and today’s low was just about $60.

Gold futures settled in New York yesterday at approximately $1571. Tuesday evening prices spiked to $1631 when Iran launched a surface to surface missile attack into two airbases in Iraq which housed U.S. troops. Iran’s Islamic Revolutionary Guard Corps took credit for the attack as a retaliatory action from Friday’s drone attack that killed their second in command, Major General Soleimani.

Within an hour of the airstrike as the dust settled reports surfaced that there were no U.S. or Iraq casualties, which cause gold pricing to selloff breaking below $1600. Prices remained under pressure throughout the evening as market participants listened intently for incoming news from Iran’s foreign minister. His statement indicated that his country had taken “proportional measures in self-defense” and didn’t seek further escalation for war. This statement along with a tweet from President Trump which said that “all is well”, continues to pressure gold pricing.

This morning President Trump announced that, “Tehran appears to be standing down” and indicated that there would be no reprisal from last night’s missile attack. The statements by both the United States and Iran indicated a major de-escalation in the conflict which began at the end of last week.

This caused gold to cascade sharply to lower pricing. After trading to a low of 1553.40, gold recovered slightly and as of 4:30 PM EST is trading at $1557.00, after factoring in today’s net decline of $17.30.

On a technical basis major support for gold pricing does not occur until approximately $1540 to $1535. $1535 is based upon a Fibonacci retracement from $1265 to $1613, the range of the most recent leg of this rally. $1540 is based upon the price top which is just below last year’s record high of $1565. Gold broke below last year’s record high at $1565 immediately following President Trump’s statement this morning, which is why our technical studies indicate that that price point is current resistance.

Wishing you as always, good trading,

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action

We were long Feb Gold @ $1507. Last Night (EST) we sent out a trade alert to Add to our long gold and raise the stop.

We are currently flat with no active trades in gold or silver

Subscribers who added a position did so at $1595. Stops will raise to $1573.

On the initial position we went long at $1507 and out at $1573 for a profit of $6600 per contract.

Those that added to the initial position pulled a profit of $4400 per contract.

 

Gold Market Forecast

Last night gold traded to its highest level in years when a missile attack cause gold to run to a high of $1613 before trading lower. As news came out that there were no casualties from the attack gold broke back below $1600, and traded between 1580 and 1590 for the better part of the evening.

That all changed when president Trump spoke at 11 o’clock Eastern standard Time confirming that both sides were de-escalating and there would be no further action from the United States.

That being said this is still a fluid scenario in which things could change rather quickly, however for now it seems that cooler heads have prevailed and we have seen a potential tinderbox de-escalate.

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