Gold – Back below $1180

Ahead of the Swiss Gold Referendum, the yellow metal traded very cautiously between $1190 and $1207. Volatility picked up on Friday, where a combination of Thursday’s OPEC decision not to cut Oil production and a Swiss poll indicating that support for buying Gold was declining sent Gold to $1165. Confirmation overnight that Switzerland voted against purchasing Gold has pressured the metal and sent Gold to its lowest valuation in nearly three weeks at $1142.

Gold looks bearish below $1180 and further signs this week that US economic activity is improving will further pressure metals. Traders should keep an eye on US Manufacturing ISMs (Monday), Construction Spending (Tuesday), ISM Non-Manufacturing Composite (Wednesday) and specifically, Friday’s US NFP. If the US jobs report heightens speculation that the Federal Reserve will turn hawkish sooner than expected, there is still potential for Gold to fall below $1100 for the first time since March 2010.

Written by Jameel Ahmad, Chief Market Analyst at FXTM.

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