Morning Wrap 29 August 2017

Good morning,
 
Gold – as described by Andre in yesterday’s morning wrap – broke free post-Jackson Hole in hectic trading. Notably pull-backs in price pre the Jackson Hole newswires in both XAUAUD and XAUUSD held the support levels mentioned last week at A$1613 and US$1278 before rallying hard, with December open interest rising by round 1.50 million Tozs by last Friday.
 
Today a North Korean ballistic missile curved over the northern Japanese island of Hokkaido before breaking up and falling into the Pacific, prompting another rally in gold as North Korea seeks to provoke a show-down with the United States in a move reminiscent of the prelude to June 1950, when Kim Jong-un’s Grandfather Kim Il Sung invaded with the particular encouragement of the Soviet Union.
 
Key price levels have been breached and challenged and in XAUAUD terms, the price could stage a A$1640-1730 move that reflects the A$1550-1643 rally prior to the recent sideways price action. That would take gold back to the June highs. Point and Figure targets certainly support a rally back to A$1700.
 
In XAUUSD terms, the price has broken well clear of the Weekly Ichimoku cloud and price targets suggest a move to US$1332 and US$1360. Support comes in at US$1299 and US$1280-83.
 
Good luck today!
 
Nick