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"The (precious metals) complex has benefited from the recent global risk-off attitude and heightened volatility. However, a pull-back was inevitable at some stage."
- MKS Group (based on CNBC)
Pair's Outlook
Yesterday markets were encouraged by dovish comments made by ECB President Draghi, while equities and many commodities rallied. Gold has therefore closed below the first target, namely monthly R3 at 1,209. Tuesday morning we are observing more selling pressure, which is pushing prices towards the October 2015 high at 1,191. By violating this initial daily support for today, the bullion will be in a good position to plummet down to the Feb 10 low at 1,181.50, followed by the bunch of demand levels between 1,170 and 1,165 (Aug 2015 high; monthly R2; 20-day SMA).
Traders' Sentiment
Monday has seen a sharp plunge in the total number of long open positions in the SWFX market. The bullish share went down to 31% from 44%, which is the lowest level we have seen while analysing this commodity.
© Dukascopy Bank SA