Gold continues the expected consolidation following the move to the objective of $2075/80. Nonetheless, strategists at Credit Suisse believe this is a temporary pause only ahead of the yellow metal core bull trend eventually resuming.
“Whilst we continue to see the long-term trend higher, reinforced by falling US Real Yields and a falling USD, our immediate bias remains for further consolidation above a cluster of supports at $1867/37, which includes the 23.6% retracement of the rally from the 2018 low.”
“Should weakness extend, we would see scope for a deeper setback to $1765, potentially $1726.”
“We look for an eventual move above $2075 with resistance seen next at $2175, then $2300. Whilst we would look for a fresh consolidation at this latter level, a direct break can see potential trend resistance at $2417, with scope seen for $2700/20 over the longer-term.”
“It is worth noting that monthly RSI has reached its extreme levels seen in 2006 and 2008 adding weight to the view for a lengthier pause in the bull trend.”
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