August Gold Futures Churn Higher

August GOLD futures are back on the bull following a midweek retracement. Bidders are gaining confidence above 1330.0 and 1350.0 appears destined for another test. Given today’s fallout from the rapidly escalating situation in the Strait of Hormuz, we may be in for a late week run to safe-havens.

This morning brought a few minor economic metrics released during the pre-market hours. Here is a quick look at the highlights:

Event                                                       Actual       Projected     Previous

Export Price Index (MoM, May)           -0.2%           -0.1%               0.1%

Import Price Index (MoM, May)           -0.3%          -0.2%               0.2%

For May, it appears that prices are on the decline for both U.S. imports and exports. While not earth-shattering market movers, this collection of data does suggest that global consumption and economic growth are softening a bit. This is in line with consensus expectations of an economic slowdown coming to pass by year’s end.

August Gold Futures Push Toward 1350.0

Since rejecting the 1325.0 area, bidders have taken over the bullion market. At this point, August gold futures are on a collision course with 1350.0.

Here are the levels to watch in this market until Friday’s closing bell:

• Resistance(1): Psyche Level, 1350.0
• Support(1): 38% Current Wave, 1324.6

Bottom Line: The 1350.0 level is a key psychological barrier and one that is conducive to short scalping. Until elected, I will have sell orders queued up from 1349.4. With an initial stop loss at 1350.6, this trade produces a tidy 10 ticks on a short-term scalp of August gold’s first run at 1350.0.

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

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