June gold futures settled at $1,428.90 an ounce, down $11 on the day, but closed in a Doji pattern on the basis of weekly closing on the Comex division of the New York Mercantile Exchange. A fall in prices from the weekly high of $1,441 an ounce to a low of 1,411.50 could be attributed to profit booking at higher levels and a decline in the US overall unemployment rate to 8.8 per cent.
The US jobs data knocked down gold hard during the early trade on Friday. However, due to short covering at lower levels, there was a significant recovery thereafter to close at $1,429 from the day’s low $1411.
Gold is likely to get support at $1,400 and higher level resistance is seen at $1,450 next week, suggest the trading pattern in the June futures and strong price-based selling pressure above the point of control ($1,435). Technically, prices are expected to face resistance at $1,450 and support at $1,411. Friday’s MKTP chart for April futures hints at a strong resistance above $1,455 and support around $1,420. Call buyers expect gold to face strong resistance above $1,440 and significant support around $1,400.
Fan Yang, an international technical analyst, says gold should accelerate with a close above the $1,447 record high. This can open up the bullish swing towards $1,510. However, resistance can be expected at $1,480 as well. This is around 138.2-150 per cent extended retracement of the decline from December-February. If there is a rally form the current support above $1,410, we should monitor the $1,430 level. A break above that level can be an early warning of a bullish attempt to breach these fresh highs.
The daily chart shows the RSI in the neutral zone, but if it can rally back above 60, preferably 70, the bullish outlook is confirmed. However, if the market is to continue ranging, we can come down to test the $1,380 level.