Gold extended an upside movement on Friday, increasing the price of the yellow metal to more than $1335 an ounce as the trendline support holds off. The technical bias remains bullish because of a Higher High in the recent upside rally.
As of this writing, the precious metal is being traded near $1338 an ounce. A hurdle may be noted around $1345, the intraday high of yesterday ahead of $1358, the horizontal resistance area and then $1375, the swing high of the latest major upside rally as demonstrated in the following chart.
On the downside, the yellow metal is likely to find a support near $1333, the trendline support ahead of $1310, the swing low of the recent downside move and then $1300, the psychological number. The technical bias will remain bullish as long as the $1250 support area is intact.
US Jobless Claims
The number of Americans who filed for unemployment benefits last week rose from a three-month low, consistent with the Federal Reserve’s view of a stronger job market. Jobless claims increased by 14,000 to 266,000 in the week ended July 23, a Labor Department report showed in Washington on Thursday. The median forecast in a Bloomberg survey called for 262,000 applications. The less-volatile four-week average dropped to remain at the second-lowest level since 1973.
Considering the overall technical outlook, buying the precious metal around the current levels can be a good strategy in short to medium term. The stop loss may be placed at $1210 while take profit levels may be near $1275.
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