Gold Price News and Forecast: XAU/USD has pulled back further and trades 1% lower on the session on Tuesday
|Gold Price Analysis: The support zones are in sight
Equities have moved further into the red today as the S&P, Nasdaq and Dow are all lower following a negative session from the EU bourses. The issue for gold is the dollar strength as it trades around 0.23% higher pushing demand for the precious metal lower. Interestingly the fall in gold is much less than that of the indices. The general risk theme has been dominated by the drop in the price of oil. Both WTI and Brent fell heavily into the futures roll and yesterday the May WTI futures contract fell into negative territory. Gold could then rise as the market paradigm shift in the future and the dollar strength eases but this could take some time.
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Gold: Is weakness supported? Does momentum improve? [Video]
The corrective conditions are still in place on gold. The question is whether the move has played out in its entirety yet. We continue to view near term corrections as a chance to buy on gold. Looking back at the price action on previous moves lower on gold, during normal market conditions, the selling pressure has been limited before the buyers have moved to support. The only times where significant lurches lower have been seen have been when significant strain has hit through equities, with margin call related selling associated with gold.
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