The U.S. manufacturing companies expanded in March at a slightly faster pace compared to the prior month. March PMI registered 53.7, an increase of 0.5 point from February's reading of 53.2, indicating expansion in manufacturing for the 10th consecutive month. The New Orders Index registered 55.1, an increase of 0.6 point from February's reading of 54.5. The Production Index registered 55.9, a substantial increase of 7.7 points compared to February's reading of 48.2. Employment grew for the ninth consecutive month, but at a lower rate by 1.2 points, registering 51.1 compared to February's reading of 52.3.
Technical view-
In yesterdays trades, gold dropped to lower levels, but did not break the morning low at $1,277. In Asia's trading session, gold is trading at $1,279. We are repeating the buy strategy today as well. Gold will move upside pulling back a bit towards $1,284 and $1,286.
Whereas $1,286 is the small resistance, if it is crossed, then we will see $1,289, $1,298, $1,304, and $1,315 (above $1,304, only $1,315 will be possible). In the H4 chart, RSI has been consolidated for a week. I expect prices will move towards up side, before any deep correction takes place. The levels of $1,288 and $1,298 are acting as strong resistance levels (previous highs in H4 chart).
On the down side, if the price breaks $1,277, we will see $1,270, $1,265, $1,261 levels. We expect buyers will enter between $1,279 and $1,260. The metal will probably melt to positive growth shocks in the US and QE tapering, and that these factors combined will encourage further advances in US real yields, fresh highs in the S&P 500 and fresh US dollar highs. A day close below the level of $1,260, the more bearish view will generate in the daily chart towards the year 2013 lows with intermediate supports.
The material has been provided by InstaForex Company - www.instaforex.com
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