FxWirePro: Gold trades flat after a major sell-off, good to sell on rallies

Major resistance- $1217 (89- day EMA)

The major three factors that drive gold prices

 US dollar Index: Neutral. DXY has declined more than 50 pips once gain after showing a minor jump above 96 level. The near term resistance is around 96.32 and any break above targets 97.It should break above 97 for further bullishness. The minor support is around 95.50(Neutral for gold).

 USD/JPY: Slightly weak . The pair has declined more than 100 pips from yesterday high of 113.94. The near term support is around 112.80 (20- day MA) and any break below targets 112.50/112. Short term trend is slightly bullish as long as support 112 holds . Any daily close below 112 confirms minor bearishness and a dip till 111/110.38 likely. Slightly positive for gold.

US 10 year yield : US 10 year yield is trading slightly lower after hitting multiyear high @3.25%.It is currently trading around 3.24%. Negative for Gold.

US 2 year yield: It hits 10 year high at 2.907% and is consolidating after hitting high.The spread between US 10 year and 2 year has increased from 22bpbs to 36bpbs.

 Gold technical

Major support $1183

Major resistance - $1217

 The yellow metal has lost more than $20 from high of $1204and it is currently trading around $1191 on account of strong US dollar and rising US 10-year yield. The trend is slightly bullish as long as resistance $1180 holds.

 On the higher side, any break above $1210 will take the commodity till $1217/$1224/$1230.

The near term support is around $1180 and any violation below will drag the commodity down till $1170/$11620.

It is good to sell on rallies around $1207-$1208 with SL around $1217 for the TP of $1180.