Gold futures continue their tumble from its May 2nd high as domestic economic data continues to lift the dollar and the perception of declining British sentiment of exiting the EU also weighing on the precious metal. June Gold futures are down nearly $22 today (as of this writing) currently trading at $1,229.60 per ounce at the Commodity Exchange in New York.
The Department of Commerce has reported new home sales for last month soaring 16.6% – the highest gain in almost 25 years – and tomorrow the Federal House Finance Agency is expected to report a one-half of 1% gain for single-family homes for the month of March. The news has helped push the US Dollar Index more than one-third of 1% to its highest level in two months – testing its December high.
“A stronger dollar eases the price of dollar-denominated commodities such as gold making it more expensive for foreign-buyers, and more advantageous for those using the greenback as their primary currency,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, sharing her fundamental assessment of the gold futures market. Levy added, “Should the Federal Reserve decide to hike interest-rates, or even ‘hint’ at doing so, this could also be potentially bearish for gold futures.”
The technical trend for gold futures is confirmed down as of today. My study shows a primary target for gold at the $1,110 level with the possibility of moving down to the December $1,050 support level. Other counterparts of mine show $1,184 as their primary target with the distinct possibility for gold futures to get down to the $1,058 support level. No guarantees, but gold seems to be moving in tandem with its seasonal tendency to trend lower until the end of June, beginning of August.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.