Gold Prices Move Lower as Risks Abate

The fall continued in the gold prices as the brief recovery that was seen in the first half of the day on Friday gave way later in the day and the prices have since been moving lower in a slow and steady manner. This has continued today morning as well as the stock markets have shrugged off the risk events and have focussed on the moving higher and this had led to the flow of funds from the safe havens like gold and silver and into the stock markets. This has led to the drop in the gold prices which now trades below 1295 as of this writing and looks good for further weakening in the short and medium term as well.

Gold Prices Likely to be Subdued

The dollar has also been trading in a steady manner for the past week or so as a hawkish Fed has helped to support the dollar. Now, all that the dollar needs is some support from the incoming data and this could help to confirm the rate hike in December. This is why the data over the next couple of weeks is going to be very crucial for the dollar, in the short and medium term as that is likely to determine whether there would be a hike in the US this year or not. If the data continues to get better, then we can expect the fall in the gold prices to continue which should then target 1270 and lower. As for today, the gold prices should be a bit supported as the German elections and the elections in New Zealand have been quite tight. Merkel has won a majority of the votes but that is not enough for her to form a government and this has led to a period of uncertainty as she tries to cobble together a coalition. This is likely to weigh on the euro and also help to keep the gold prices buoyed.

The ranges in the oil prices have been getting tighter and tighter over the last few days but the strong bullish trend is clear for everyone to see. Any sort of correction has been met with strong buying which has helped the prices to bounce time and again. Also, the strength of the dollar seems to have little effect on the oil prices for now.

Silver prices have also been moving lower over the last few days, in line with the gold prices and now they trade below $17 as of this writing and it is likely that they remain weak in the short and medium term.