Gold Bulls in Control But for How Long ?

Gold prices traded within a tight range for most of the day yesterday despite the rise in global risks and fall in some stock indexes around the world. We had a terrible terrorist attack in the UK yesterday which shook the world but the markets seem to have taken it well in their stride and after an initial wobble, the markets have recovered well since then and the gold prices have hence didnt have much to do. The gold prices continue to trade near their range highs just below 1250 and the fact that they continue to trade strongly should be an encouraging sign for the bulls for the move towards the next target of 1260 in the gold prices. Once the prices reach there, it would be interesting to see what happens there and whether a much needed correction is witnessed there or whether gold prices continue to move higher.

Gold Prices Waiting for Direction

Looking ahead to today, we have voting on Obamacare scheduled to be held later in the day and also have the Fed Chief Yellen making a speech. Both of these events are likely to cause some heavy volatility in the gold prices as a failure of the Obamacare repeal could put a lot of pressure on the dollar while Yellen is generally known to drop some hints about the direction of the economy and response of the Fed to such changes and also about rate hikes in her speech. So, the markets are likely to consolidate ahead of these 2 key events scheduled to be released later in the day and it is better for the traders to wait for these events to finish before they jump into any specific trade.

Oil prices continued to consolidate and trade weakly and this has been the case over the past 2 weeks. Except for one significant move over a period of 2 days in this month, the oil prices have been fairly steady over the last 3 months making it a very difficult instrument to trade for the last few months.

Silver prices also consolidated for the second day yesterday as there was not much happening in the markets in terms of economic events and so the trader chose to trade safely and did not want to push the prices either way.