Gold extended upside movement on Monday, increasing the price of yellow metal to more than $1200 an ounce, following the release of some key economic news. The technical bias remains bearish because of a lower low in the recent downside move.

Technical Analysis

As of this writing, the yellow metal is being traded around $1216 an ounce. A hurdle can be noted near $1240.58, the horizontal l resistance area  ahead of  $1275, the trendline resistance area and then  $1300, the psychological number as demonstrated in the given below daily chart.

On the downside, a support can be noted near $1171, the trendline support area ahead of $1150-$1156, the confluence of psychological number as well as horizontal support area and then $1133, the lower trendline support zone. The technical bias shall remain bearish as long as the $1337 resistance area is intact.

Trump Remarks

In his inauguration speech on Friday, Trump said his administration would put “America first” and also promised new roads, bridges and highways. But market sentiment was hit by the negative tone of the speech, which underlined uncertainty over how Trump will govern. On Monday, Trump said he is going to cut taxes massively for middle class and companies. He also is reported to have told a number of U.S. chief executives that companies will get fast approval to build new factories in the U.S., but those that move abroad will face major border taxes.

Trade Idea

Considering the overall technical and fundamental outlook, selling the precious metal around current levels appears to be a good strategy in short to medium term.