MF Global Daily Report: Precious Metals (Aug. 24, 2011)

Aug. 24 (MF Global) -- Price Outlook

The gold market is a tough call in today’s trade after yesterday’s action narrowly missed creating a bearish key reversal pattern. Support will continue to come from the prospect of fresh Fed easing, the re-pricing of recession odds in light of recently weak economic data, and from central bank purchases of gold. Key resistance is offered at 1,946 and yesterday’s trade moved within $28.10/oz of that level before nearly creating a bearish key reversal pattern. There’s a potential for pressure, however, from the hike in margins in Shanghai, the possibility that the CME also hikes markets, recent liquidation from non-commercial traders, yesterday’s better economic news, and from the possibility that Bernanke’s Jackson Hole speech fails to announce new stimulus. We favor trading gold as a trading affair today.