FxWirePro: Gold slightly higher on weak global stock markets, good to buy on dips

Gold hits low of $1200 and shown a minor recovery on global sell-off in stock market.

The major three factors that drive gold prices

 US dollar Index: Neutral for intraday. DXY has broken major trend line resistance 97.50 and jumped till 97.69.It is currently trading around 97.51.The near term resistance is around 97.70 and any break above targets 98. ( neutral for gold).

USD/JPY: strong . The pair has recovered for day after hitting low of 113.58. The pair jumped more than 350 pips from low of 111.37 and hits 5-week high at 114.22. It is currently trading around 114. The near term resistance is around 114.25 and any break above targets 114.55/115. Slightly negative for gold.

 US 10 year yield : US 10 year yield has lost more than 2% from high of 3.25%.Any further bullishness only above 3.25%. It is currently trading around 3.18%. Slightly positive for Gold.

 US 2 year yield: It is trading lower after hitting hitting fresh multi-year high at 2.98%.The spread between US 10 year and 2 year has decreased from 30bpbs to 26 bpbs.

Gold technical

Major support $1183

Major resistance - $1240

 The yellow metal has lost more than $30 from high of $1236 account of strong USD .On the higher side, major resistance is around $1217 (55- day EMA) and any break above $1217 will take the commodity till $1227/$1236 .It should break above $1243 (Oct 26th 2018 high) for bullish continuation.

The near term support is around $1200(trend line support) and any violation below will drag the commodity down till $1200/$1190.

It is good to buy on dips around $1200 with SL around $1190 for the TP of $1220.