Gold dropping hard to $1,241.49, testing the key ascending trend line support
|Gold has taken a hit and has dropped to the $1,241 24th March lows as the dollar rips and yields rise in the 10-year bench mark to 2.4233 highs.
The dollar was helped along by an improvement in the Q4 GDP beating expectations along with further Fed speakers advocating hikes this year. Dudley was the most recent Fed member speaking that was associated with this late move in the US session. In his opinion, gradual rate hikes would be appropriate to stave off inflation overshooting significantly.
- Fed's Dudley: Easing financial conditions played role in prompting March rate hike
- Fed's Dudley: Gradual rate hikes appropriate to avoid overheating, significant inflation overshoot
The latest data on fourth-quarter U.S. gross domestic product has the U.S. economy expanding by 2.1% for the last three months of 2016. This beat the initial consensus of a 1.9% annual rate. This was the latest economic indicator to fuel a bid in the dollar and is coupled with much higher consumer confidence and a stable labor market laying own the foundations for further rate hikes fro the Fed this year.
Gold levels
Gold dropped below $1247 and the 200-DM after breaking down the $1250 29th March highs. A break of these 24th March lows would be significant being the key supporting trend line and will open $1232 being the 50-DMA and $1227 as the March 21st low.
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