The gold price is under pressure today after reaching a key technical level for the third time, while also facing pressure from strong economic data from the US.
At 4.52pm gold was trading at $1,247 down from $1,255 in yesterdays close
For weeks now gold has approached the 200-day moving average on the technical chart only to face stiff resistance and it seemed like the same scenario today.
Some say this is a sign that the bulls are running out of steam after gold’s spectacular comeback in the last few months and we may be in for a reversal of trend,
“This is the third time that gold has failed at the critical resistance level and with the turn in dollar strength, the path of least resistance suggests a weaker tone,” said Peter Hug, global trading director at Kitco Metals Inc
Also, hurting the gold price today was the release of strong data from the US and a bullish tone from the US Federal Reserve in their latest FOMC meeting that has investors betting on another imminent rate hike which is negative for gold,
“Firstly, the pickup in gold interest in Q1 was slower than we expected,” noted analysts from UBS. “
“A faster pace of Fed tightening than previously expected presents downside risks for gold, although more from the impact on sentiment than how we expect Fed policy to ultimately affect rates.” they added.
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