Technical Analysis Gold for February 8, 2016

Gold prices surged breaking higher and poised to test resistance near the late October highs at 1,183. Support is now a long way off near the 200-day moving average at 1,129. The 10-day moving average crosses above the 200-day moving average showing that a short term trend is now in place. Momentum remains positive with the MACD printing in the black with an upward sloping trajectory which points to higher prices. The RSI (relative strength index) on the other hand is printing a reading of 77, which is above the overbought trigger level of 70 and could foreshadow a correction.

January nonfarm payrolls added 151k compared to a mean of 200K. The jobless rate ticked down to 4.9% from 5.0% since October.The workweek ticked up to 34.6 from 34.5 in December.Hourly earnings were 0.5%, which left the year over year figure at 2.5%.