Gold has moved higher again today, but the range is fairly narrow suggesting perhaps a better balance of buyers and sellers. With Saudi Arabia talking about increasing oil production, there is less an upward bias. Nevertheless, the tension in the Middle East and oil prices still at the $100 a barrel price level, the safe haven trade seems to be continue to be in full swing. Of course the technicals, will give the clues about the fundamentals. So outlining the important levels is important. The price yesterday moved above the shallow trendline that defined the top earlier in the week (see daily chart above). The low today dipped just below the trendline support $1409.67 level. This level will be a key borderline to watch on the downside today. From the daily chart, the next key topside target would extend up to the $1424 level where the November 2010 high comes in along with the 2011 high (1st trading day of the year). Off the hourly chart, there is topside trendline that comes in at the 1419.40 level currently. This is a closer target for the pair today and becomes the next target that has to be breached. On the downside, the high from yesterday at the $1410.95 level will be another support level. If this level and the $1409.67 level (from the daily chart) are breached, some further profit taking can be expected. Until then,however, the bias is still to the upside for the pair.

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