Gold feel seven dollars to 1275.00 overnight as a resurgent U.S. dollar weighed upon precious metals. Weaker China and European data and a lack of chest thumping from North Korea diminished the safe haven appeal of gold following the weekend. We suspect the lull is only temporary however and gold will continue to be supported on meaningful dips.
This morning gold continues to hover around 1275.50, just above initial support at 1275.00. A daily close below here may imply a deeper correction to 1260.00 is on the cards. However, longer term bulls will only get concerned should the 100-day moving average at 1254.85 break.
Resistance lies at 1282.00 initially ahead of 1292.50 and then the formidable 1296.00 region which must break and consolidate before we can start talking about a structural move onto a 1300.00 handle.