April gold prices rebounded from important support level
April gold futures were trading in a downward channel. Gold prices broke out of the channel resistance of $1,213 per ounce on Thursday, February 26, 2015. As a result, gold prices retreated from the key support level of $1,200 per ounce on February 26 and 27. The rise in gold prices was supported by the increase in Chinese buying after the new year break. It was also supported by the consensus of a delay in the interest rate hike by Federal Reserve in 2015.
Key support and resistance
Bullish traders could see the resistance of gold at $1,280 per ounce. The resistance is formed from the peak of February 2 and 3. On the down side, support is seen at $1,200 per ounce—as stated above. A strong dollar would always push the dollar-denominated gold in a downward direction.
Based on the gold chart, gold prices could trade at $1,200–$1,280 per ounce, unless there’s a bearish or bullish news trigger. Then, the gold price direction could change. However, the RSI (relative strength index) and MACD (moving average convergence divergence) suggest that prices could move sideways in the short term.
The rise in gold prices affects gold ETFs’ profitability—like the SPDR Gold Trust (GLD). Ultimately, it affects gold stocks—including Goldcorp (GG), Newmont Mining (NEM), and Barrick Gold (ABX). These stocks make up 25.7% of the VanEck Vectors Gold Miners ETF (GDX).