DC deadlock is great for gold: Pro
Face it—Washington will take its standoff down to the wire. And the shutdown and debt ceiling debate should end up being a golden opportunity.
Gold remained quiet on Sunday night. This, after it traded in a range of over $20 on Friday that tested $1,326, the highest level since Tuesday, as it ran stops through from the mid-week highs. With a failure to follow through, gold settled to a floor close of $1,317.60.
Through Friday's session and into Monday, gold has found support at $1,304.10 to $1,306, as it failed to chew through this level to press new lows.
With Washington still in deadlock, a weaker equity market has helped support gold. Fear is keeping gold above the $1,300 level. A close above $1,323.50 is needed to signal a consolidation higher, and would point toward a test of $1,338 to $1,340.10.
(Read more: Why the shutdown could mean no tapering this year)
Only a close below $1,304.10 to $1,306 will signal a follow-through lower. Still, even if we get below $1,300, we will look for the $1,291.50 level to provide support for this market.