Gold Prices Bounce from Support

Gold prices bounced off the support region in what has to be said, was a well planned move that was telegraphed loud and clear much before it happened. Since the beginning of the week, the gold prices have been in a tearing hurry on the back of global risks and uncertainties and so, once the risks faded, it was only natural for the traders to expect some sort of a correction in the prices and thats what we have been seeing. The gold prices had taken a lot of effort to break through the 1300 region and so when the prices corrected back to the resistance turned support, it was natural to expect it to bounce and this what is what we saw over the last 24 hours as the prices have bounced by around $20 and now trade in the 1320 region as of this writing.

Traders Await the NFP

The market awaits the NFP data from the US later in the day today along with the wages data. After the strong ADP data and the GDP data from the US couple of days back, the expectations are for a strong NFP and wages data and that is the reason why we have been seeing the dollar recovering across the board. So, if the incoming data today fails to beat the expectations, we could see another large round of dollar selling which could help the gold prices to skyrocket even further in the short term which should then carry the prices towards the 1350 region.

Oil prices also rose by more than 2% over the last 24 hours, something which we have been saying all along. We had been mentioning in our forecasts that the oil prices are only in a temporary correction and once the storm in the US blows over and things return back to normal, the demand for oil would pick up and this would push the prices back higher again. Also, the inventory data showed a much bigger draw than what was expected and these 2 data events was the trigger for the move up in the oil prices which is likely to trade in an upbeat manner in the short term.

Silver prices also staged a recovery over the last 24 hours and like gold, they also wait the employment data from the US to launch its next stage of the bull run which should see it challenge the $18 region.