Gold Lower Due to Stronger US Dollar

Gold and silver, after a few attempts, were both unable to break up through their respective resistance levels of $1,322 and $17.22. The break-down of the euro/dollar trade through the 1.20 level initiated some profit taking in both metals yesterday.

The 30-year U.S. bond broke above the 2% level yesterday, adding further pressure to the metals complex. The metals have remained resilient in the face of a soaring equity market and some calming of tensions with North Korea, and a significant sell-off is unlikely. Gold may trade down to the $1,305 level today and silver may fade as low as $16.87, should the $17 level give way. We continue to see the resistance levels noted above as the hurdle to overcome for continued higher momentum.

via Kitco

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza