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Gold Climbs on North Korean Tensions

The price of spot gold (XAU/USD) continues to climb on thin holiday trade this morning. The financial markets in Hong Kong, Australia and New Zealand were all closed for Easter. There is a dour mood among investors thanks to rising tensions that have sent the financial markets lower today. Very few will be open today as most regions are closed for the holiday. Over the weekend, North Korea held yet another missile test, which failed. The United States has an aircraft carrier battlegroup sailing to the region and both countries are rattling the war sabers.

The United States is adopting a policy of “maximum pressure and engagement” in their approach to relations with Pyongyang. US Vice President Mike Pence is on a 10-day trip in the Asian and Pacific Rim to, among other things, pitch this new policy towards North Korea.

This morning, the US Dollar tracked Treasury yields lower as the priced-in 2017 in Fed Funds futures, for rate hikes, flattened. This helped to boost the appeal of non-interest bearing assets like gold.

gold
gold chart

Gold Technical Analysis

The price of gold continued its climb higher. Looking at the above daily MT 4 chart, buyers are eying the $1,300 per ounce pivot. A daily close back above a small congestion area that run from 1302.90 to the former support at $1,308 per ounce targets the next upside target at 1316.20.

The alternative technical analysis notes the first downside barrier lining up at 1282.30. A break below this first technical support challenges the next downside barrier that lines up at the end of a cluster zone that runs to the February 27 high. This area is at 1263.88 to 1265.65.

Please note that the financial markets in Europe and the North American time zones are closed for the Easter holiday.

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