Forex Gold Signals Article on declining Gold

20 Jul 2016
Gold Signals

Forex Gold Signals Sentiments 

Forex Gold Signals analyses are for Long term trend will be still bullish, but expected to be drop around 1270-1280 before continuing again towards 1400+. more likely it seems that price will hit again 1350+ level before a drop to 1270-1280 level.  Daily intraday signals will be send to subscribers and those who are not subscribers they can check the history on our daily Signals History once the movement is over for that specific day.

Overview

Gold prices decreased by 0.41% on Wednesday ,as the precious metal is trading at a spot price of $1325 per ounce.The yellow metal has been trading flat for the past three trading sessions as the prices remained stuck around 1330 but the bullion has slightly lost value and reached the supported provided by the 20 day simple moving average at 1326 having consolidated near the low of the past two weeks. In the U.S, no major events are up. NAHB Housing Market Index is relatively stable.
The yellow metal continues to remain a favored safe haven asset despite the economic uncertainty clouding post Brexit. Gold prices are consolidating after a strong rally.

The US dollar has hit 97.19 today, the highest since March. The US dollar has been gaining strength against the British Pound and Euro post Brexit. The gain is supported by rising investor sentiments regarding higher rates for US Fed Fund future and better-than-expected U.S housing data which portrays a theme of strength in the U.S economy. A stronger dollar usually dampens the gold’s appeal as an alternative asset. Moreover the DJIA (Dow Jones Industrial Average) closed at 18,559 reporting a 0.14% increase whereas Nasdaq and SP 500 have also shown relative increases, which has dampened gold prices amid clear signals of weakness among eurozone banking stocks and a plunging Japanese Yen.
Whereas in the U.K according to the official data released today, the unemployment rate in the U.K has fallen to 4.9% which is the lowest level since 2005.Excluding bonuses the wages have also risen by 2.2% which was below the forecast of 2.3% increase. Following the report, the pound strengthened against the U.S dollar which favors a rise in gold prices eventually.

Investors will be carefully monitor the ECB meeting on Thursday for signals in interest rate movements where further quantitative easing will be positive for the metal.Japan is also seen to be easing both monetary and fiscal policies may cause the gold’s recent rally to lose some of its steam as the demand for higher-yielding assets increases.The consensus is that the central bank will leave the interest rates on hold. Support level is seen near the June lows at 1250 and the resistance is more or less near the 10 day moving average at 1346.
.On the daily chart, the 12 & 20 day EMAs are moving sideways which can limit upside potential. Moreover a combination of bearish daily Parabolic SAR reading and a Bullish H4 reading depict indecisiveness among investors. Mirroring this sentiment, the relative strength indicator is flat which should see gold price fluctuating between 1300 and 1375 over the next week. If the metal prices continue to fall it will probably meet its first weekly support of 1318 enabling investors to pull out before any major losses might happen. The bullish undercurrent remains above 1305-1290 which maybe tested if the breakout results in prices falling downwards.
Its likely that gold will remain consolidated until it until the support level 1320 or resistance level 1340 is broken.Upside limit according to hourly charts is limited to 1335

Forex Gold Signals  sentiment is long term bullish. Several reasons call for a bull market like the contagion resulting from Brexit, increasing likelihood that US interest rates will remain stable, negative interest rates in other countries and uncertainty surrounding the US elections. Its unlikely though that the gold price will drop to pre Brexit levels.

 

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