gold futures

Amid the recent chaos in equities, June gold futures are on the cusp of posting a three-session winning streak. Values have bounced from yearly lows at 1267.3 to the 1285.0 area. It seems that bullion is gaining traction in the wake of recent trade war strife.

As we covered Monday, this week’s U.S. economic calendar is wide open until Thursday and Friday. Today brought the release of a few peripheral metrics:

Event                                                        Actual     Projected       Previous

Redbook Index (April 29, YoY)                5.9%           NA                   5.5%

JOLTS Job Openings (March)                  7.488M     7.240M         7.142M

IBD/TIPP Optimism Index (MoM, May)  58.6          54.5                 54.2

This group of reports suggests that the U.S. economy is performing well and expectations are high. The retail sector is up, employment continues to boom, and consumer sentiment is positive.

Simply put, today’s numbers paint a rosy picture. Nonetheless, traders have chosen to continue the early May exodus from stocks. Subsequently, GOLD is gaining a bit of ground.

June Gold Futures: Technical Outlook

Throughout 2019, three-session winning streaks have been hard to come by for June gold futures. If the current bullish sentiment holds firm, then today will mark the first three day run of green candles for May.

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

Here are two resistance levels worth watching as the trading day progresses:

  • Resistance(1): Bollinger MP, 1286.8
  • Resistance(2): Daily SMA, 1288.7

Bottom Line: The long-term trend for gold is down and a sell from topside resistance isn’t a bad way to get in on the action. Until elected, I will have sell orders queued up from 1288.4. With an initial stop at 1290.9, this trade yields 25 ticks on a 1:1 risk vs reward management plan.

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