Gold has been appreciating against the Dollar since the middle of March, having crossed a few important resistance levels. The dollar clawed back losses partially by the end of the previous month and XAU/USD dropped to the nearest powerful support level at 1179.10. But weak statistics for the US stock market released on Wednesday, 1st April, weakened the Dollar and allowed the precious metal to head for a recent local high and key resistance level at 1218.85. Yesterday, gold grew by 2.4% having reached a level of 1205.00.
Today, the metal is consolidating in a narrow range of 1202.00-1205.00. Such US macroeconomic statistics as labour market data, trade balance and production orders are worth attention today. The demand for gold may grow at the beginning of the American session if initial jobless claims do increase, as anticipated.
Support and resistance
In the medium term, gold may grow further to the levels 1218.85, 1252.20, 1281.65. However, the trend remains downward, therefore buying gold could be risky under such circumstances.
Support levels: 1191.20, 1179.10, 1167.00, 1143.75, 1133.10.
Resistance levels: 1218.85, 1252.20, 1281.65, 1306.90, 1345.70.
Downward trading should be continued. Short positions should be opened from key resistance levels at 1218.85, 1252.20, 1281.65 with profit fixing at local low of 1133.10.