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The gold is still suffering from the higher interest rate outlook in US

Discussion in 'Current Market Sentiments' started by fx-recommends, Mar 25, 2014.

  1. fx-recommends

    fx-recommends Content Contributor

    Aug 6, 2008
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    The Gold is still undermined by higher interest rate outlook in US has been prompted in the markets following last week Fed’s hints which suggested having the first interest rate hike within 6 months following ending the Fed’s QE which can continue be tapped by the current measured pace to be ended this year.
    Despite it tells that there can be a pause between ending of the Fed’s QE and the beginning of dependence on the interest rate in directing the monetary policy, the markets have seen in the Fed’s members voting on reaching 1% federal funds target rate at the end of 2015 and 2% in 2016 clear stronger exported rates by the Fed than what has been priced in the money markets before that meeting and telling that it is to be dependent on a broader range of data and indicators than the 6.5% unemployment rate to figure out the economic stance shows that there can be much potential care of the inflation on the account of the growth as you can see on following that voting that the Fed was referring to starting of hiking the interest rate again in the second half of 2015 when it has managed to adopt this voting policy with Ben Bernanke for guiding the markets.
    These shifts are still weakening the demand for the US treasuries supporting their yields and making the gold less attractive as a safe haven option, despite their negative impacts on loading risks in the equities markets in the same time and also despite the tension between Russia from a side and US and EU from another side which can be escalated by growing sanctions can depress the Russian economy and in return can cause problems of the energy supply in EU can be added to the weights on the European struggling economy.

    The Gold is still able to exist over its previous supporting level at 1307$ per ounce after getting below 1320$ which supported it last week before failing to get over 1342$ again to be traded now below its 4h 200 moving average now and God willing in the case of retreating further below 1307$ whereas it has formed previously on 20th of last month a bottom over its 4h 200 moving average, it can face the psychological level at 1300$ while there are other standing other standing supporting levels below it have been formed in its way of rebound this year at 1283$, 1231$, 1218$ before 1200$ psychological level which can be followed by its lowest level of last year at 1180$ which could hold supporting it at the end of it to rebound from 1182$ while going up again from here can be met by resisting level at 1342$ which could not be taken out again after easing below it last week to be its obvious lower high after peaking on 1392$ which has been reaching in the beginning of last week on the back of Crimea referendum to be capped from getting over 1400$ which can be followed by 1433$ which has been reached on previous worries about imposing US military action against the Syrian regime fueled the energy prices
    Kind Regards

    FX Market Strategist
    Walid Salah El Din
    Mob: +20 12 2465 9143
    E-Mail: mail@fx-recommends.com

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