Gold prices in the EUR terms extended post-ECB gains today as the metal continues to cheer the prospects of fresh currency debasement in December- more QE/rate cut.
Eyes strong resistance at EUR 1057/Oz
The metal is fast approaching a strong resistance at 1057 – confluence of the 200-DMA and 50% retracement of Apr-September drop. Draghi’s hint at a possible change in QE and/or deposit rate cut in December led to a sharp fall in the EUR and a rise in the Gold/EUR pair.
The metal could take out the resistance in case the preliminary Eurozone CPI readings disappoint market expectations.
Gold/EUR Technical Levels
At EUR 1055/Oz, the immediate resistance is seen at 1057, above which the metal could test 1077.42 (61.8% of Apr-Sep drop). On the other side, a failure to take out 1057 could push the prices back to 1037 (38.2% of Apr-Sep drop).