Gold extended upside movement on Wednesday during the Asian session, increasing the price of the precious metal to more than $1350 an ounce as bulls gain strength. The technical bias remains bullish because of a Higher Low in the recent downside move.
As of this writing, the yellow metal is being traded near $1353 an ounce. A hurdle may be noted around $1358, the major horizontal resistance area ahead of $1367, the high of the recent upside wave and then $1375, the swing high of the latest major upside rally as demonstrated in the given below daily chart.
On the downside, the precious metal is expected to find a support around $1336, the trendline support ahead of $1310, the swing low of the latest major downside move and then $1300, the psychological number. The technical bias will remain bullish as long as the $1310 support area is intact.
US Wholesale Inventories
The U.S. wholesale inventories unexpectedly rose in June on gains in stocks of farm products and other non-durable goods, suggesting an upward revision to the second-quarter economic growth estimate. The Commerce Department said on Tuesday that wholesale inventories increased 0.3 percent after having been initially estimated as unchanged. Inventories for May were revised up to show a 0.2 percent rise instead of the previously reported 0.1 percent gain. Economists had forecast wholesale inventories unchanged in June in line with the government’s estimate last month. That unchanged reading was incorporated in the advance second-quarter gross domestic product estimate published last month.
Considering the overall technical and fundamental outlook, buying the precious metal on dips appears to be a good strategy in short to medium term.