Interest rates in America continue to be a major issue for metals markets, as gold fails to break above $4600 early on Monday.
Gold
The gold market continues to get thrown around by the bond market as we have seen for several weeks now. Interest rates in America continue to be stubbornly high and that weighs upon gold. It is also worth noting that we had a technical level come into play during the Monday session as the $4,600 level has proved itself to be resistant.
If we can break above there, then it opens up the possibility of a move towards the 50-day EMA, but we need to see rates slump. So far, the 4.30 level in the 10-year is like a basement floor and as long as we're above there, I just don't see how gold takes off.
We did get a little bit of a jump early when President Trump had tweeted out that the US and Iran were talking and it looked like things were going better, but since then we haven't seen any real follow through and let's be honest here, there have been multiple times where the Iranians have walked back any idea that there is progress.
Finding a Footing
I think we're still very much in a bottoming pattern and I think we're just trying to find our footing here somewhere near the $4,400 level where there is a significant amount of support and then after that we have the 200-day EMA at $4,228. If we can break above $4,600, like I said, it could kick off a fresh leg higher but right now I just don't see that being very easy to accomplish.
We need something concrete in which investors can start to really believe in. Right now, it's a lot of social media posts and nonsense going back and forth. Your position size is the most important thing to monitor with any trades you take in this environment.