Forecasts & Analysis | Fundamental, Page

Demand remains subdued

Gold consolidates ahead of Fed

The new short-term range is $2.305 to $2.413. Its 50% level or pivot at $2.359 is controlling the direction of the market today. The price action suggests that a support base is forming. Prices aren’t likely to move much out of this range until traders get the next weather forecast.

On Monday, gold prices are recovering from their lows following the release of a weaker-than-expected Empire State Manufacturing Index report. It came in at -8.6, well below the 12.1 forecast and 17.8 previous read. We’re not expecting major moves in Treasury yields or the stock market ahead of the Fed

While the inside trade may indicate opinions are mixed about the catalysts behind the price action, the lower trade suggests expectations of lower demand are outweighing supply fears being generated by Iran’s potential involvement in the attacks on oil tankers in the Gulf of Oman last week.

The concern for traders is not likely whether the Fed cuts rates or not at the June meeting, but how dovish it comes across for cuts in July or September. The market has been driving Treasury yields lower due to uncertainty over trade and geopolitics, the economy has been steady

Last week’s economic reports were mixed but the reduction in the chances of a June rate cut indicates that investors don’t expect a rate cut from the Fed at this meeting because the economy is still relatively strong. Some investors feel the need for a rate cut has been driven

Ahead of the day, the Greenback might show some good upward movements making the Index touching the 2/1 Gann fan. Oil prices dropped after the statement of US Secretary of State Mike Pompeo.

After a sharp fall on Friday, EUR/USD is seen consolidating near its 200-period moving average on a 4-hour chart. All eyes will be on the Fed meeting later this week. Ahead of it, the pair has some potential to bounce higher.

The British pound fell sharply against the dollar on Friday as the greenback strengthened broadly following US retail sales data. There are several important economic releases this week that should keep volatility elevated in the pair.

I’m not expecting too much of a reaction to the Fed news from gold traders. The next two moves by the Fed have been telegraphed for at least a week. In my opinion, the Euro is going to have a bigger influence on the price action. A weaker Euro will

Early in the week, trader reaction to a minor top at $2.406 will tell us if the short-covering is getting stronger. If momentum begins to build on this move then the rally could eventually extend into the short-term pivot price at $2.518. This rally will look impressive on the short-term

Early Tuesday, the RBA will release its Monetary Policy Meeting Minutes. The minutes are expected to show policymakers are supporting a July rate cut. On Wednesday, the U.S. Federal Reserve is expected to leave its benchmark interest rate unchanged at 2.50%, but could issue a dovish monetary policy, Early Thursday,

The U.S. Federal Reserve is expected to leave its benchmark interest rate unchanged at 2.50%, but could issue a dovish monetary policy, which hints at a rate cut in July. Investors will be looking for clues for an easing of monetary policy later this year.

The unease across financial markets has intensified the oil markets recent sell-off.

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As we mentioned last week, Gold should at minimum be on everyone’s radar if not in everyone portfolio. After the break of the psychological $1350, Gold is reclaiming its rightful status as a must-have asset in everyone’s investment portfolio.

Over the long-run a direct U.S.-Iran conflict would likely lead to the shutdown of the Strait of Hormuz. This poses a higher risk of oil-supply disruption, which could lead to sharply higher prices. Therefore, we may continue to see attacks, but until there is a military response to the attacks,

Energy shares weighed on the broader market

Injections are rising at a robust rate