Gold Falling Heavily
Gold Under Pressure
Gold prices are plunging today ahead of the upcoming US inflation print this afternoon. Friday US jobs data has seen a strong rise in hawkish Fed expectations with the market now pricing in a more than 70% chance of a hike by year end, up from around 50% prior to the NFP. Traders are now looking to today’s US inflation data which is expected to show CPI jumping above 4% for the first time in 3 years. If seen, this will no doubt see rate hike expectations jumping again with pricing for an October hike likely to move above 50%, pushing USD higher and sending gold lower. Indeed, if we see an upside surprise in today’s data this will be firmly bullish for the Dollar and heavily bearish for gold.
US/Iran War
Gold prices are also being weighed on by ongoing uncertainty over the Iran war. Although seemingly counterintuitive, given that gold typically rises during periods of heightened geopolitical uncertainty, with USD rallying as a result of the ongoing conflict tensions are simply adding to bearish gold sentiment currently via stronger support for USD. With news of fresh attacks between the US and Iran overnight, peace prospects remain heavily muted and risks of a fresh spike higher in USD and oil remain elevated, keeping gold vulnerable to further downside near-term.
Technical Views
XAUUSD
The sell off in gold is gathering pace here with price now pushing heavily below the broken bull trend line from last year slows and the 4,389.24 level. Price is now fast approaching a test of the 4.092.60 YTD lows. With momentum studies bearish, focus is on a continuation lower towards the 3,898.03-level next.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.