Commodities Consolidate on Slow Day

Gold prices continue to consolidate and range in the 1280 region where there is likely to be a lot of support. A lot of things happened around the world yesterday, especially in the UK, but all these events seem to have little impact on the gold prices. As we had mentioned yesterday in our forecast, we can expect some consolidation and probably even a deeper correction in the gold prices towards the 1265 region before we see the next push towards the 1300 region from the bulls. We have also been seeing the dollar hold steady over the last 24 hours and this has also helped to hold the gold prices steady.

Gold Prices Wander About Directionless

It is indeed a surprise to see the gold prices shooting up higher ever since the beginning of the month while the exact opposite was what was expected from it towards the end of last year when the Fed raised rates for the first time in several years. With 3 rate hikes expected to happen this year alone, it looked pretty bleak for gold at that point but it is to the credit of the bulls that they have made full use of any dollar weakness to push the gold prices higher and higher. They have been helped along by Trump and his team who have bungled on all major policy changes and also making clear that they would prefer a weaker dollar and lower interest rates. This was enough ammunition for the gold bulls to push the prices even higher and look even higher in the weeks ahead.

Oil prices dipped a bit over the lat 24 hours but this kind of correction and consolidation was something that was expected from it. It trades just below $52.8 as of this writing but we expect this region to hold for the short term and we could see a jump into the $53 region again during the course of the day. We have the official release of the oil inventory data today but this data was released through the API yesterday itself and it probably showed a jump in the inventory, which is why we have seen a dip in the oil prices.

Like the gold prices, the silver prices have also been consolidating over the last 24 hours and it is likely to see some buying in this region and even if it weakens further, we believe that a lot more buying is likely to come in in the $18 region.