Has gold just bottomed?
Updated
Gold has been trending lower in the past few weeks as the FED hasn't been as dovish as the market has anticipated following the weaker than expected economic, especially inflation numbers... The market has also ignored the reckless rhetoric between TRUMP and North korea's "little rocket man". However, I believe this correction is about to end given that there is no major change in the federal reserve policy outlook which the market has already priced in even tighter policy outlook in the past few years.
Friday, the employment report was released, most economists were expecting a poor and even as distorted number in a hurricane season. We saw an initial rally in the USD on strong earnings, which is the most watched figure in the jobs report these days, as it gives indication on future inflation. But gains were erased later in the session , either because the numbers are just not reliable and probably distorted due to severe weather.
Or because the dollar has already priced in a slightly tighter policy since the Feds last fomc, which lifted probabilities for december rate hike. And now, the markets need more than that to sustain further dollar strength, at least a clear indication of rising inflation which would force the fed to move faster in raising rates.. which is not the case in the near future.
Having these conclusions, I am speculating on dollar weakness across the board in the coming weeks. and gold is one of my long picks.
This is my personal view, do your own due diligence. Would be happy to read your views in the comments section.
Trade with care
Technician
Friday, the employment report was released, most economists were expecting a poor and even as distorted number in a hurricane season. We saw an initial rally in the USD on strong earnings, which is the most watched figure in the jobs report these days, as it gives indication on future inflation. But gains were erased later in the session , either because the numbers are just not reliable and probably distorted due to severe weather.
Or because the dollar has already priced in a slightly tighter policy since the Feds last fomc, which lifted probabilities for december rate hike. And now, the markets need more than that to sustain further dollar strength, at least a clear indication of rising inflation which would force the fed to move faster in raising rates.. which is not the case in the near future.
Having these conclusions, I am speculating on dollar weakness across the board in the coming weeks. and gold is one of my long picks.
This is my personal view, do your own due diligence. Would be happy to read your views in the comments section.
Trade with care
Technician
Note
1295 is a key resistance now. W
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