Gold trading outlook: futures trade near two-week highs as markets expect Fed Chair Yellen’s remarks

On Friday gold for delivery in August traded within the range of $1,206.40-$1,244.50. Futures closed at $1,240.10, soaring 2.50% from Thursdays close. It has been the 46th gain in the past 88 trading days and also the most considerable one since March 17th, when the yellow metal advanced 2.86%. The daily high has been the highest price level since May 23rd, when a high of $1,251.60 was registered. In weekly terms, gold rose 2.17% during the past week. It has been the 11th gain in the past 22 weeks and also the steepest one since the week ended on May 1st. The commodity has added 2.36% to its value so far during the current month, following a 5.77% slump in May.

On the Comex division of the New York Mercantile Exchange, gold futures for delivery in August were edging down 0.59% on Monday to trade at $1,243.40 per troy ounce. The precious metal went up as high as $1,251.25 during early Asian trade, while the current daily low was at $1,242.50 per troy ounce, recorded during the early phase of the European trading session.

The US Dollar Index, a gauge reflecting the relative strength of the greenback against a basket of 6 other major currencies, was inching up 0.03% on the day at a level of 94.06, after reaching 94.04 earlier. On Friday it plunged to 93.86, or its lowest level since May 12th. The index has fallen 1.86% so far in June, after advancing 3.04% in May. The latter has been the strongest monthly performance since November 2015, when the dollar gauge rose 3.29%. Weaker dollar usually favors demand for gold and other dollar-denominated commodities, as they tend to become cheaper to holders of other currencies.

Today market players will be paying a close attention to Fed Chair Janet Yellens speech, scheduled at 16:30 GMT, for hints regarding the Banks future stance on policy. According to CME Groups FedWatch tool, there is a 4% chance of a rate hike occurring in June after the disappointing US payroll numbers, down from 21% before the official employment report was released. In addition, there is a 32% probability of a hike occurring in July, down from 58% as of Thursday.

Meanwhile, silver futures for delivery in July were down 0.15% on the day to trade at $16.430 per troy ounce, after going down as low as $16.365 a troy ounce during the early phase of the Asian trading session.

Daily and Weekly Pivot Levels

By employing the traditional calculation method, the daily pivot levels for gold are presented as follows:

Central Pivot Point – $1,230.33
R1 – $1,254.27
R2 – $1,268.43
R3 – $1,292.37

S1 – $1,216.17
S2 – $1,192.23
S3 – $1,178.07

By using the traditional method of calculation again, the weekly pivot levels for gold are presented as follows:

Central Pivot Point – $1,227.87
R1 – $1,256.73
R2 – $1,273.37
R3 – $1,302.23

S1 – $1,211.23
S2 – $1,182.37
S3 – $1,165.73