Gold prices clocked a post Brexit low of $1310.50 levels as increasingly optimistic US economic outlook pushed up Fed rate hike bets and strengthened US dollar.
December Fed rate hike above 40%
As per latest CME data, December Fed rate hike bets now stand at 42%. September and November rate hike bets are cruising towards 30%. The data indicates markets are clearly, but grudgingly pricing-in a possibility of a rate hike this year.
Consequently, dollar index rose to 4-month high in overnight trade. Meanwhile, stocks trading at record highs amid positive earnings and calm in the post Brexit world are forcing investors to move out of safe haven assets like gold and into riskier assets. No wonder gold dropped to lowest since June 24.
Gold Technical Levels
The metal was seen last trading at $1315. A break below Asian session low of $1310.50 would expose $1300 handle. On the higher side, $1322.70 (July 14 low) would open doors for a re-test of $1337.50 (yesterday’s high).
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