What started out as a promising double bottom for gold has quickly gone sour and now we can see a double top has formed and a bearish one at that. It seems that investors were reluctant to push the precious metal through the $1,300 mark just a week ago and since then gold has tumbled to around $1,250 at the time of writing this article.
A sustained break below this level in today’s trading session may see a move down to $1,250
The catalyst for the recent tumble has been optimism over tax reform in the US which has passed both houses of congress and just needs a few details to be sorted out before President Donald Trump signs it into law.
Another factor that will keep gold under pressure until at least next week is the rate decision from the US Federal Reserve who are widely expected to lift rates which is already priced into the market’
The danger for gold is that the following statement will contain news of further rate hikes which will be sooner than most expected and may also pressure the gold price.
"Gold is testing critical long-term support at $1,260 in Asian trading," said Jeffrey Halley, senior market analyst at OANDA. "A break of this level opens up a potential 50-dollar move to $1,200 as gold suffers from investor flight to crypto currencies and the prospect of an FOMC rate hike next week with more to come in 2018."
The recognition by Donald Trump of Jerusalem as Israel’s capital city is likely to cause wide range instability in the Middle east and according who you listen to, could be come a serious problem or an outright catastrophe and such a scenario may see gold find some much needed support.
Activity of FIBO Group, Ltd. Company is regulated by the Financial Services Commission (FSC), registration number of the licence: SIBA/L/14/1063.
Trading on Forex market implies serious risk including the risk of loss of all the funds invested. Please, take into account that trading on the forex market isn’t suitable for all investors and traders.
Unfortunately the services of the company aren’t provided to residents of Austria, Great Britain, Iraq, North Korea and the USA.
Recommended Content
Editors’ Picks
USD/JPY holds near 155.50 after Tokyo CPI inflation eases more than expected
USD/JPY is trading tightly just below the 156.00 handle, hugging multi-year highs as the Yen continues to deflate. The pair is trading into 30-plus year highs, and bullish momentum is targeting all-time record bids beyond 160.00, a price level the pair hasn’t reached since 1990.
AUD/USD stands firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday. The AUD/USD advance was sponsored by a United States report showing the economy is growing below estimates while inflation picked up.
Gold soars as US economic woes and inflation fears grip investors
Gold prices advanced modestly during Thursday’s North American session, gaining more than 0.5% following the release of crucial economic data from the United States. GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the US Fed could lower borrowing costs.
FBI cautions against non-KYC Bitcoin and crypto money transmitting services as SEC goes after MetaMask
US FBI has issued a caution to Bitcoiners and cryptocurrency market enthusiasts, coming on the same day as when the US Securities and Exchange Commission is on the receiving end of a lawsuit, with a new player adding to the list of parties calling for the regulator to restrain its hand.
Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. The BoJ will announce its decision on Friday at around 3:00 GMT.