gold futures

June Gold Futures Back Above 1300.0

Posted Tuesday, April 9, 2019 by
Shain Vernier • 1 min read

A fresh round of tariffs and global economic growth concerns have boosted risk aversion for the Tuesday session. Investors are bidding June GOLD futures for the second consecutive day, prompting a spike above the 1305.0 handle.

The rally in bullion began in earnest on Monday, following U.S. President Trump threatening to slap $11 billion in tariffs on various E.U. products. In addition, the International Monetary Fund (IMF) revised global growth forecasts down to 3.3% for 2019. This is a substantial cut from the previous figure of 3.5%, most likely a result of the IMF expecting U.S. growth to drop from 2.5% to 2.3%.

The beneficiary of investor angst has been June gold futures. Prices have already rallied more than $12.50 per ounce this week, ahead of Wednesday’s FOMC Minutes.

June Gold Futures: Technical Outlook

Bearish action dominated the trade of gold during the latter stages of March. Early April has been a different story, with June gold futures breaking out from a prolonged “L” formation on the daily chart.

June Gold Futures (GC), Daily Chart
June Gold Futures (GC), Daily Chart

As we roll into the midweek, here are a few levels to watch for June gold futures:

  • Resistance(1): Daily SMA/62% Current Wave Retracement, 1313.3
  • Support(1): Bollinger MP, 1305.9

Bottom Line: As a general rule, the convergence of technical indicators adds validity to the pricing level in question. For June gold futures, the Daily SMA and Current Wave 62% Retracement fall at 1313.3, creating a possible short entry.

Sells from 1312.9 are a good way to fade the recent bullish action. With an initial stop placed at 1314.7, this trade produces 15 ticks on a slightly sub-1:1 risk vs reward management plan.

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