Technical Bias: Bearish
- Gold heading towards $1200
- US PPI news is due today
- Sellers wait for solid bearish signal
The price of gold inched higher on Friday, increasing the yellow metal to more than $1180 an ounce ahead of some key economic releases. The technical bias remains bearish due to a Lower Low in the recent wave.
As of this writing, the precious metal is being traded around $1182 an ounce. A support can be noted near $1177, the 61.8% fib level ahead of $1164, the 76.4% fib level as demonstrated in the following daily chart.
On the upside, the yellow metal is expected to face a hurdle near $1187, the 50% fib level ahead of $1198-$1200, the confluence of 38.2% fib level as well as psychological number and then $1211, the 23.6% fib level.
Producer Price Index
The US Bureau of Labor Statistics is due to release the Producer Price Index (PPI) figure today during the early New York Session. According to the average forecast of different economists, the PPI remained 0.4% in May as compared to -0.4% in the month before. Generally speaking, higher PPI reading is considered positive for the US Dollar (USD) and vice versa so a better than expected actual outcome may incite renewed selling pressure in the price of Gold.
Considering the overall technical and fundamental outlook, selling the pair around $1200 handle appears to be a good strategy in short to medium term if we get a bearish pin bar or bearish engulfing candle on the daily chart.