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GOLD: Downward pressure towards 1182.47

The USD index rose on Friday’s session breaking out of consolidation and making fresh highs at 86.865 after better than expected nonfarm payrolls.

No headline news on today’s economic calendar so it may be a very quiet trading day.

GOLD fell and broke below the 1204.70 level and closed at 1191.40 well inside the daily support zone but above 1182.47 Year low. The precious metal made a bearish wide range day that may be a sign of exhaustion. The stochastic is still showing oversold market conditions. The one million dollar question for gold direction; will it test the previous low of 1,183 and bounce to higher levels or will it penetrate this support level and set the stage to continue the bearish trend.

Expecting an upward move to 1237.96 on a break above Friday’s high at 1215.33 (scenario 1) or a pullback at 1204.70 could push GOLD to Year low at 1182.47 (scenario 2).