MF Global Daily Report: Precious Metals (Aug. 17, 2011)

Aug. 17 (MF Global) --  Price Outlook
Gold prices are expected to trade in a mixed direction today. Key resistance will come at $1,800 and $1,817 while support will be at $1,769. Prices could be bolstered today by the Merkel-Sarkozy meeting yesterday, indications of slow U.S. economic growth, and from a resilient trade in gold in the wake of the Aug 11th bearish reversal pattern. Opposing pressure will come from weakness in the Swiss franc and commodity currencies, from an expected recovery in risk trades, and from last week’s hike in gold margins by the CME. We think that prices should fall in the near-term, but were impressed by the market’s ability to remain firm in the last two sessions. We withdrew our sell recommendation at $1,800 prior to yesterday’s open.