GOLD
· Fed - slightly less dovish to hawkish tone - Previous months CPI data showed no reduction, increased from 2.9% to 3%, therefor during Oct FOMC, Powell had less dovish to slightly hawkish tone, indicating that they would like to see inflation come close to their target before considering any future rate cuts, also mentioned they will be data dependant and will need to see certain indicators (inflation) improve before can consider rate cuts. Since they wouldn’t want inflation to get out of hand again. This means DOLLAR stays bullish due to US yields remain high hence less investor outflows.
· Trade War optimism - Trump met with Xi and signed deals bringing optimism to markets, therefor investors back to risk on mode hence sell demand for safe havens.
· US shutdown - The only thing stopping us from expecting more rapid sells is the US shutdown which is still causing investors to be cautious and not as risk on, hence markets ranging a lot.
· Market whales betting on Poor US data - we know from recent headline that larger institutions are betting on the fact that the Fed will continue rate cuts even once the US shutdown ends because they think that the data will come in weak hence the Fed will have no choice but to continue its rate cuts to improve economic activity , This is the primary factor in play at the moment and hence the rally in gold since Monday.
GOLD-
1. Continuation buys if break and retest above 4220, targeting closer to previous ATH's.
2. If price holds below 42000 KL, can see more ranging and potential corrections to the downside for sells trades down to 4150.
Watching 4150 to see how price reacts, if confirmations for retests can take buys with trend for upside continuation. If breaks below, can play sells to lower demand zones.
source https://www.tradingview.com/chart/XAUUSD/L6I8siQu-GOLD/
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