Gold: The bulls are taking a breather [Video]

Gold

Anyone trading gold on Friday may just as well have gone back to bed, as the market completed the smallest daily range (just $5) of 2020. Last week we focused on the four week uptrend, which had been briefly breached by the Nonfarm Payrolls volatility but essentially remained intact. This support of the uptrend could well be broken simply by consolidation this week. What this does mean is that the bulls who have been driving the market to new multi-year highs last week, are just taking a breather. The question is whether this turns into a near term slip or is the precursor to the next leg higher. Support in the band $1757/$1764 will determine this. A closing breach of $1764 could see a drift back towards $1744/$1747 which is the next area of old breakout support. Momentum in the run higher is just beginning to tail off slightly, but for now retains its positive configuration (with daily RSI above 60 and Stochastics above 80). Trading above $1764 we are still bullish on the near term prospects of gold to push above $1789 and into the $1800s (an upside implied target for the next few weeks can be derived around $1820). Below $1764 we look to use supported weakness towards $1744 as a chance to buy.