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Gold Prices Correct As Expected

By:
Colin First
Published: Jun 26, 2017, 05:19 UTC

Gold prices had some price action that was on expected lines. We had mentioned in our forecasts over the last few days that the prices would find some

Gold

Gold prices had some price action that was on expected lines. We had mentioned in our forecasts over the last few days that the prices would find some support in the 1240 region and once it began to consolidate for some time over there, it was clear that it was preparing itself for a bounce and thats what we saw as the prices began to bounce. We had then set our targets near the 1260 region and had expected the prices to reach there and then begin to start correcting again as the next leg of the downtrend and thats what we have seen as well. The prices did move towards the 1260 region during last week and then the correction began as we are now seeing the prices trade in the 1254 region as of this writing.

Gold Prices Continue to Weaken

This is likely to continue in the short term though the dollar itself is growing weak in the knees against the other currencies. There was been a bit of confusion on how to interpret the incoming data from the US as the Fed has chosen to ignore it in the hope that it would improve in the near future but there have been no signs of any improvement so far. We are also seeing the stock markets move higher over the last few days and these signals have been pretty much contradictory which is bringing in a sense of confusion in the markets as far as the gold prices are concerned. Some of these contradictory moves could also be attributed to the month end flows that are likely to happen in the second half of every month.

Gold Hourly
Gold Hourly

Oil prices failed to show much strength on Friday and this should put in a lot of fear in the hearts of the oil bulls. Now the only thing that could save the oil prices from falling towards the lows again is the escalation of the conflict in the Middle East. Though it is a very bad thing to hope for, it could turn out to be a real possibility as everyday, the tensions in the region only seem to be growing more and more and there does not seem to be any move from any side to stem the worsening situation. With the US firmly on the side of Saudi Arabia and its partners, there seems to be little hope of any thaw in the tension and this could push the oil prices higher as the tension ratchets upwards.

Silver prices have also corrected a little bit over the past couple of days, in line with the gold prices, and they are likely to continue to be weak in the short term as the market prepares itself for the new month by adjusting its positions.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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