Gold trading outlook: futures lose ground ahead of preliminary US manufacturing activity report

On Friday gold for delivery in April traded within the range of $1,221.80-$1,232.80. Futures closed at $1,230.40, going up 0.35% on a daily basis. It has been the 10th gain in the past 15 trading days and a third consecutive one. In weekly terms, the commodity lost 0.70% of its value in the past week, following four consecutive weeks of gains. It has been the sharpest weekly drop since the week ended on January 3rd, when the metal plunged 1.57%. Gold has appreciated 8.27% so far during the current month, following a 5.29% surge in January.

On the Comex division of the New York Mercantile Exchange, gold futures for delivery in April were losing 1.38% on Monday to trade at $1,209.20 per troy ounce. The precious metal went down as low as $1,206.00 during early European trade, while the current daily high was at $1,226.80 per troy ounce. The daily low has also been the lowest price level since February 18th, when the metal went down as low as $1,201.60 per troy ounce.

Gold has recently been supported due to a strong demand for haven assets amid continuing decline in crude oil and other commodity prices.

Today gold trading may be influenced by the flash data on US manufacturing activity in February by Markit Economics. The respective preliminary Purchasing Managers’ Index probably came in at a reading of 52.5 this month, according to market expectations. If so, it would be the highest reading since November 2015, when the PMI was reported at a final 52.8. In January the final seasonally adjusted PMI stood at 52.4, falling down from a preliminary 52.7. In case the flash manufacturing PMI showed a better-than-anticipated performance in February, this would have a moderate bullish effect on the US dollar and a moderate bearish effect on gold, respectively.

Silver futures for delivery in March were losing 1.73% today to trade at $15.075 per troy ounce, after slipping to as low as $14.950 during early European trade. Last week silver went down 2.64%, while marking its first slump in the past five weeks and also the steepest one since the week ended on January 3rd, when futures declined 4.01%.

Daily and Weekly Pivot Levels

By employing the traditional calculation method, the daily pivot levels for gold are presented as follows:

Central Pivot Point – $1,228.33
R1 – $1,234.87
R2 – $1,239.33
R3 – $1,245.87

S1 – $1,223.87
S2 – $1,217.33
S3 – $1,212.87

By using the traditional method of calculation again, the weekly pivot levels for gold are presented as follows:

Central Pivot Point – $1,221.07
R1 – $1,248.53
R2 – $1,266.67
R3 – $1,294.13

S1 – $1,202.93
S2 – $1,175.47
S3 – $1,157.33