Gold Continues Higher Looking for 1260

Gold prices pushed higher yesterday as the dollar weakened across the board and we also saw a general risk off mode across the markets yesterday as fears surrounding the changes in policy that are likely to be brought about by Trump has gripped the markets again and as a result of that, the gold prices shot higher. It is general for the funds to move out of risky assets like the stock markets and get invested into the dollar and gold when a risk off mode rises in the markets. Yesterday, we saw the stock markets around the world get a beating but the risk off mode was due, in large part, to the risks surrounding the dollar and as a result of that, the funds were pulled out of the dollar also and everything got invested into gold and thats why we have been seeing gold prices moving higher and higher and seemingly set to move into the 1260s in the short term.

Gold Continues Higher

We had mentioned this in our forecasts over the last couple of days where we had said that any weakness in the dollar is likely to be fully exploited by the gold bulls who will be pushing the gold prices higher and higher. We expect the prices to move back towards the range top once again, in the 1260s, and we will then watch the price action there closely to see whether it is going to form a double top and fall or whether it is going to move on further. The region between 1260 and 1270 has been known to be a very strong resistance region in the past and so we do not expect the gold prices to move through that region, atleast not in the first attempt.

Oil prices threatened to move higher briefly yesterday but were quickly beaten back and it trades very weakly just above $48 as of this writing and looks good for some more weakness. The weakness in the oil prices set in late in the day which is an indication that some big fund managers and traders have received an intimation of the inventory data that is due in today and by the looks of the price action, it seems that the inventory data is likely to show even more build up which will put further pressure on the oil producers that are part of the production cut agreement. This would translate into even more pressure on the oil prices in the coming days.

Silver also trades near its range highs as it follows the gold prices in moving up based on the dollar weakness and this is set to continue in the short term.