Gold needs to remain above $1300

6 February, 2019

The gold price has staged a substantial rally since last week after the US Federal Reserve latest board meeting where they stated that any move in US interest rates would be data dependent and they were in no hurry to push rates higher.

This left many in the market believing that the Fed may be done with their latest rate hiking cycle which was the main catalyst for gold’s rally as the US dollar loses some of its `yield appeal when rates are kept the same and as a result benefits gold.

Since the latest interest rate decision from the Fed, the market has seen a wave of solid economic data from the US which included another strong US jobs report which has now thrown doubt into the theory that rates will remain on hold and that the Fed may have to keep raising them.

This has been reflected over the last few days with the US dollar rebounding against the major currencies as well as gold which is reflected on a technical level with the higher highs and lower lows.

Residual strength in the dollar gives off the impression of a near term dollar uptrend and that could keep the bias in both gold and silver pointing downward,” noted analysts at Zaner Precious Metals.

“Clearly, the gold and silver markets damaged their charts Monday by extending a recent pattern of lower lows and lower highs.” They added.

For now gold remains comfortably above the $1300 mark which seems to be its new support base and the next few days will be critical in seeing whether this level will hold.

This will come down to any further strength in the US dollar and if the Market really believes the Fed is done with their rate hiking cycle or this is just a temporary pause and more hikes are on the way.

Source link  
Euro awaits Jackson hole

Despite all the pressure facing the European economy the Euro has managed to remain above the $1.10 level, but it seems the market is predicting...

Gold's next target is $1600

The gold price has taken a breather over the last few days after rallying more than $100 dollars in the space of 2 weeks and some...

Gold rally not over

The gold price remains firmly above the US $1500 dollar mark in today's trading session as traders seek out the precious metal as a safe haven on the back of political...

Gold poised to hit $1500

Gold continues to surge in today's trading session, following on from last weeks solid gains as investors seek out safe havens against the...

Aussie dollar up on Chinese data

The Australian dollar remains firmly above the US70c mark in today’s trading session after a strong round of data out of China alleviated...

Pound may hit $1.37 by years end

The British pound is expected to face increased volatility over the coming months as the deadline approaches for the UK to leave the EU at the end...

Has the US dollar peaked?

The US dollar has made significant gains against all the major currencies over the last month as worries over trade tensions between...

Pound may suffer in the long term

The British pound continues to power ahead in today's trading session after yesterday's developments in the British parliament that many see as ending...

Only way for oil is down

The oil price has now broken down through the all important $50 mark, which is a physiological blow to any chance of a rally, and according to...


Share it on:   or