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A Cyprus deal and a close below 1589.6(GCJ3) give bears control:

Option(GCJ3)expiration could keep market pinned around $1600 . Shortly after the open Sunday night Gold reached a low of 1601.5 before rallying to new highs of the evening at 1612.5, the point at which the market sold off early Friday. Gold is currently sitting just above 1600 with a session low of 1600.7 so far. Last night's trade was choppy as traders were using the new out of Europe and whether a deal between Euro finance chefs could be struck to save Cyprus. The one directional move we are taking out of tonight is that once a deal was announced to be likely, the Euro covered its gap from last Sunday night just shy of 1.31 and Gold spiked lower, thus defining Gold's use as a safe haven currency. However, now with the Euro back to 1.30, the Dollar slightly higher Gold still has no mojo and fears around the world have been slightly relieved. Traders will be watching major support at 1598.6. Last week Gold never traded below there and a move through this support will be bearish, with a close below next support at 1589.6 as signaling a bearish leg down. Only a close back into the 1605-1607.5 area can neutralize this early weakness, but a close back above 1610 and new highs of the day will be slightly bullish. Bottom line play the range you could BUY against support with a tight stop or SELL against Resistance taking $5-10 each trade.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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