In the early morning trade, gold has slightly extended its rally from yesterday and currently trading at $1,311.8, which is up $2 for the day. The main reason for yesterday’s $10 rally in gold was definitely because of the President’s cancellation of the June 12 nuclear summit meeting with North Korea, which put fear buying back into the risk markets. The little selloff in the US dollar yesterday and hopes that it will continue also added to some investors buying gold down at these levels. Furthermore, due to some weak geopolitical data this week, talks of tempering US rate hikes in June are most likely giving August gold a boost at these levels and might add to the rally.
If you take a quick look at the daily August gold chart, you’ll see that gold has rallied itself up into a very bearish down trendline, which should act as resistance at these levels. If it can eventually break above this resistance, the gold should rally to its last high of $1,332.4 back on May 11th. If August gold continues to rally above this level, then you can’t rule out that it will rally up to the $1,375.1 high of April 11. All technical levels are highlighted below on my RJO Futures PRO chart.
Gold Aug ’18 Daily Chart