FxWirePro: Gold upside capped by 61.8% fib, good to buy on dips

Gold jumped nearly $13 on Friday on account slight weakness in US dollar and minor dip in US 10 year yield.

The major three factors that drive gold prices

 US dollar Index: weak for intraday. DXY has lost more than 50 pips on Friday and broken major support 96.60 (20- day MA). It is currently trading around 96.56.The near term resistance is around 97.05 and any break above targets 997.40/97.70. (S neutral for gold).

USD/JPY: Weak . The pair is trading slightly weak for 4th consecutive days. USDJPY has broken  major support 113 (20-day MA )at 113 It is currently trading around 112.75. The near term support is around 112.64 (55- day EMA) and any break below targets 112.14/112. Slightly positive for gold.

 US 10 year yield : US 10 year yield has lost more than 6% from high of 3.25%.It faces strong support around 3.07 (89- day EMA) .Any further weakness below 3.07%. It is currently trading around 3.07%. Slightly positive for Gold.

 US 2 year yield: It is trading lower after hitting hitting fresh multi-year high at 2.98% and lost more than 6.5%.The spread between US 10 year and 2 year has decreased from 30bpbs to 26bpbs.

Gold technical

Major support $1183

Major resistance - $1240

 The yellow metal is consolidating after hitting high of $1225. On the higher side, major resistance is around $1226 (61.8% fib) and any break above $1225 will take the commodity till $1230/$1236 .It should break above $1243 (Oct 26th 2018 high) for bullish continuation.

The near term support is around $1190 and any violation below will drag the commodity down till $1178/$1160.The minor support is around $1209/$1200.

 It is good to buy on dips around $1215 with SL around $1209 for the TP of $1230.