Gold Market Commentary For Monday Evening

Gold closed higher due to short covering on Monday as it consolidates some of last week's decline but remains below the 20 day moving average crossing at 1117.90. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If April extends last week's decline, the reaction low crossing at 1088.50 is the next downside target. Closes above last Wednesday's high crossing at 1128.30 would temper the near term bearish outlook in the market. First resistance is the 20 day moving average crossing at 1117.90. Second resistance is last Wednesday's high crossing at 1128.30. First support is last Friday's low crossing at 1097.30. Second support is the reaction low crossing at 1088.50.

Silver closed slightly higher due to short covering on Monday but remains below the 10 day moving average crossing at 17.189. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are neutral to bearish signaling that a short term top might be in or is near. Closes below the 20 day moving average crossing at 16.698 would confirm that a short term top has been posted. If May renews the rally off February's low, the 75% retracement level of the aforementioned decline crossing at 18.293 is the next upside target. First resistance is last Wednesday's high crossing at 17.665. Second resistance is the 75% retracement level of the December-February decline crossing at 18.293. First support is last Thursday's low crossing at 16.835. Second support is the 20 day moving average crossing at 16.698.

The U.S. Dollar closed higher on Monday as it rebounds off the lower boundary of the trading range of the past six weeks. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near term. Closes below the reaction low crossing at 79.92 are needed to confirm a downside breakout of the aforementioned trading range and would open the door for a larger degree decline into spring. If June renews this winter's rally, weekly resistance crossing at 81.97 is the next upside target. First resistance is the reaction high crossing at 81.70. Second resistance is weekly resistance crossing at 81.97. First support is last Friday's low crossing at 79.95. Second support is the reaction low crossing at 79.92.

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