Gold could retest $1900 amid equity and dollar strength - Walsh Trading's Sean Lusk

(Kitco News) - While the longer-term outlook for gold remains strong, seasonal factors along with the strength in stocks and the U.S. dollar mean the precious metal could retest $1900 before it goes higher, according to Sean Lusk, co-director of commercial hedging at Walsh Trading.

From a seasonality perspective, you run higher the second half of summer, with better physical demand, Walsh told Kitco News on September 1. We haven't really seen that seasonal bounce until very recently here. Seasonally, you back off a little bit in September after the run-up into the Labor Day weekend. But with everything else going on globally, you have to throw seasonals out the window a little bit.

From a technical perspective, Walsh noted that gold traded back through some support levels last week, but the jury is still out on whether there's going to be a continuation rally this week.

I'm not sure how this portends to a potential rally, and follow through over $2000 an ounce, he said. I think the market is telling us, it got up to $1980, anywhere near there is going to be met with some psychological resistance again. But technically, it really doesn't matter.