Gold prices flat on Wednesday morning

Wednesday, Jun 24 2015

There were no major data releases in the Asian session, with traders being more focused on commodity prices. On Wednesday morning gold is trading flat at 1176.50 just above its support level at 1174.80. Earlier this week gold dropped below $1,200 an ounce as equities climbed after Greece presented a new plan to stave off default before an emergency summit on the country’s debt crisis. Buying on dips for small profits can be done until deal is reached. Gold is unlikely to sustaining above $1200 levels thus short term correction towards $1160 is possible.

Besides Greece, investors keep track on state of China's economy. The Chinese economy has reached a "now what?" point.It's slowing, but not fast enough for authorities to exercise the nuclear option of a full-on stimulus that would add more debt to a highly levered nation.At the same time, it's still slowing faster than authorities would like. Economic data is mixed, but trends to the downside more often than not.

"China should concentrate on reconstructing the economy, avoid concerns about growth rate fluctuation of one or two percentage points, and under no circumstances become so anxious as to resort to strong stimulus," said an "authoritative insider" — aka the government — in a recent editorial on state news site The People's Daily.

It seems that Aussie is following gold trends, and after initial incline this morning found resistance around 0.7660 area, pulling back to a current 0.7720 level. Pair is likely to find support around 0.7680 level, yesterday's low, and resistance above 0.7770 area. Later today, in the US session, Final GDP figures are scheduled for a release.

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