Testing Resistance

The broader defensive feel witnessed in Asia-Pac trade has resulted in a firmer DXY and lower U.S. Tsy yields, creating cross currents for bullion, with spot last dealing little changed, just shy of $1,780/oz. Last week's high ($1,783.9/oz) capped gains early on this week and provides initial resistance just ahead of the 38.2% retracement of the Jan 6 to Mar 8 sell off ($1,784.8/oz). A break through the latter would allow bulls to focus on $1,800/oz, with any break there exposing the late Feb highs. ETF holdings of gold continue to trend lower, and now sit ~11% shy of the record level of holdings posted back in October, but remain elevated in historical terms.