Gold had secured an advance of the break of a prior triangle pattern at $1,898. However, its advance can be tempered for now by $2,001, the 61.8% Fibonacci retracement of the volatile March range of $2,070-$1,890, Benjamin Wong, Strategist at DBS Bank, reports.

Awaiting next dip to re-engage

“Bypassing $1,981 opens the gateway for a test of the psychological $2,000 price barrier (which as well heralds the 61.8% Fibonacci retracement of the $2,070 March peak-$1,890 late March dip at $2,001).”

“Gold’s advance appears to be technically driven, and in part driven by the inflation hedge theme this week with March PPI for final demand surging by most in records back to 2010.” 

“This could be just a shorter spanned three-legged correction which makes 2,001 a keenly watched resistance peg. So do not rule out a rollback which keeps the main bullish trend intact given the weekly MACD signal is with the bull – which could deliver another dip, but to go long again.”