Gold bugs licking their lips as Trump sentiment turns
Gold has rallied this year and Trump has added fuel to the fire on the back of investor's concerns.
The risk-off play is backing the bid in Gold as the DXY struggles around the 100 mark, bonds pick up demand, a spike in volatility, global stocks slumping and all this looks bullish for the precious metal as the Trump party seems to be finishing before schedule and the punch bowl looks pretty empty right now.
Markets had been expecting positive outcomes for the US economy under Trump's pro-America and US business administration, but, so far, some of his executive orders have been all but pro-business with his travel bans that were contested and found to be unconstitutional, blocked by the Courts and his authority put into question.
Markets have simply lost confidence in Trump for now and with Trump talking down the dollar, this could be a trend that continues as a prop for gold bugs out there who are calling for a swing in the US economy to the downside - a turn in the dollar should support a rally in Gold, as it often moves inversely to movement in the greenback and lower yields make it less attractive to invest in assets that offer interest, sending more investors to precious metals. Gold can run higher to $1,240 and 6th October lows before meeting any real technical resistance with $1,120 the downside target. Longer-term, should the status quo continue on, $1,300 will soon com under pressure again.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
