The price of Gold extended downside movement on Monday, dragging the precious metal to less than $1175 an ounce after the release of some key economic releases. The technical bias however remains bullish because of a Higher High and Higher Low in the ongoing wave.
As of this writing, the metal is being traded around $1171. A hurdle may be noted near $1191, the swing high of the most recent upside rally ahead of $1200, the pychological number. A break and daily closing above the $1200 resistance area could incite renewed buying interest validating a move towards the $1282 in the long run.
On the downside, the precious metal is likely to find a support near $1164, the 23.6% fib level ahead of $1134, the 50% fib level and then $1100, the psychological number. The technical bias will remain bullish as long as the $1100 support area is intact.
China’s economy expanded quicker than economists forecast in the third quarter as the services sector propped up the world’s second-largest economy, suggesting monetary and fiscal stimulus is keeping Premier Li Keqiang’s 2015 expansion target within reach. Gross domestic product rose 6.9 percent in the three months through September from a year earlier, the National Bureau of Statistics said Monday, beating economists’ estimates for 6.8 percent. Still, that was the slowest quarterly expansion since the first three months of 2009, based off previously announced data.
Considering the overall technical and fundamental outlook, selling the precious metal around current levels could be a good strategy in short to medium term as long as the $1191 resistance area is intact.