The Current Market Sentiment

The gold could rise further in the beginning hour of the new week breaking its previous resistance at 1324$ per ounce.

The gold which has been by the oil rebound last week could be underpinned too strong falling of the US treasuries yields with persisting retreat of the US equities made the gold more attractive.

UST 10YR is now at 2.62% and also UST 2YR yield is now trading at 0.35% after it had reached last month 0.47% which was the highest rate it could have since May 2011.

As the expectations of having higher interest rates in the money markets rose after the Fed signaled that it tend to be based on the interest rate changing in conducting its monetary policy sooner than later, before the release of the Fed’s last meeting minutes on 19th of last month which put all of the US yields in defensive positions as the minutes have shown a possibility to mention Fed’s worries about the low inflation rates saying also that the interest rate projections out of the committee look lower than them inside of it.

The gold could get use of this sentiment but the US stocks to start another round of falling following another strong jobs figure as the same as what they have done following the release of US labor report of March, as the current improving if the US labor figures seem enough to the Fed to continue its measured pace of tapering driving the federal fund rate up really within 6 months following the end of the QE as Yellen has mentioned after that meeting.  

It looks that the inflation data to come out from US will be much more important to the markets than before, as the talking about the inflation direction has increased recently, after the Fed drop its 6.5% unemployment rate previous target of keeping the interest rates at the current exceptional low levels preferring adopting a broader range of indicators to figure out the economic performance and it said that these indicators will include the inflation data in what could reflect the rising worries about its low rate persisting comparing with 2% inflation yearly target of the Fed.