The gold price has continued to fall in today’s trading session after yesterday’s surprise announcement from the US Federal Reserve that a rate hike in December was a distinct possibility which left investors exiting most assets, including gold and moving into the US dollar.
Gold remained well supported in recent weeks as talk of military conflict grew between the US and North Korea and expectations that the Fed would hold off raising rates any further this year.
Fed president Janet Yellen in her following speech after the rate decision noted that the US economy is in good shape and a case for higher rates is justified
“The Fed’s monetary policy update sees investors flee from the non-yielding asset,” said analysts at Accendo Markets.
“The resultant stronger U.S. dollar puts a further dent into sentiment, increasing the relative price of the precious metal. While off overnight lows of $1,296 courtesy of 5-month intersecting support, overnight falling highs are continuing to pressure gold,” they added.
Gold is now at a key technical support level which is the double top that was formed in April and June. If the precious metal does manage to break down through this level it should find support at the $1.283 level although there is a risk that this may fail to hold
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72% of retail investor accounts lose money when trading CFDs with this broker. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72% of retail investor accounts lose money when trading CFDs with this broker. Before deciding to trade foreign exchange you should consider whether you understand how CFDs work, your investment objectives, your level of experience and readiness of taking risk. The possibility exists that you could sustain a loss of some or of all of your initial investments and therefore you should not risk more than you are prepared to lose. Please seek independent financial advice if necessary.
|By clicking "Continue" you will be redirected to the website operated by FIBO Group, LTD company registered in BVI and regulated by FSC. Please familiarize yourself with the Customer Agreement through the link. Click "Cancel" to remain on this page.|