Gold and silver are facing heavy selling pressure as the US Dollar soars and anti-fiat asset demand fades before the Federal Reserve releases minutes from January’s FOMC meeting. Traders will be most interested in the tone of discussion surrounding the possible tapering of the size of asset purchases – an approach that has emerged in several Fed officials’ comments over recent weeks – and the possibilities for the timing of such an outcome.
Bond markets suggest investors are pricing in inflation at an average of 2.35 percent over the Fed’s target one- to two-year time horizon, up from 1.47 percent at the beginning of the year. That puts a move above 2.5 percent – the FOMC’s threshold for maintaining the current accommodative posture – well within reach over the coming months. This means Ben Bernanke and company may be pressured to reduce stimulus far earlier than previously expected, supporting a recovery in the greenback.
Cycle-sensitive crude oil and copper prices are trading little-changed, mirroring undecided risk appetite trends reflected in muted early start on US stock exchanges. However, a shift toward the center from the dovish side of the Fed policy expectations spectrum following the FOMC minutes release may spark risk aversion. Needless to say, such an outcome bodes ill for oil and copper prices. Alternatively, affirmation of the central bank’s accommodative posture seems likely to produce the opposite result.
Spot Gold (NY Close): $1605.05 // -5.00 // -0.31%
Prices broke below support at 1617.84, the 61.8% Fibonacci expansion, exposing the 76.4% level at 1599.10. A further push below that targets a falling channel bottom at 1586.13. The 1617.84 level has been recast as near-term resistance, with a reversal back above that eyeing the 50% Fib at 1632.97.
For more Information Plz log on to www.rpshares.com
Bond markets suggest investors are pricing in inflation at an average of 2.35 percent over the Fed’s target one- to two-year time horizon, up from 1.47 percent at the beginning of the year. That puts a move above 2.5 percent – the FOMC’s threshold for maintaining the current accommodative posture – well within reach over the coming months. This means Ben Bernanke and company may be pressured to reduce stimulus far earlier than previously expected, supporting a recovery in the greenback.
Cycle-sensitive crude oil and copper prices are trading little-changed, mirroring undecided risk appetite trends reflected in muted early start on US stock exchanges. However, a shift toward the center from the dovish side of the Fed policy expectations spectrum following the FOMC minutes release may spark risk aversion. Needless to say, such an outcome bodes ill for oil and copper prices. Alternatively, affirmation of the central bank’s accommodative posture seems likely to produce the opposite result.
Spot Gold (NY Close): $1605.05 // -5.00 // -0.31%
Prices broke below support at 1617.84, the 61.8% Fibonacci expansion, exposing the 76.4% level at 1599.10. A further push below that targets a falling channel bottom at 1586.13. The 1617.84 level has been recast as near-term resistance, with a reversal back above that eyeing the 50% Fib at 1632.97.
For more Information Plz log on to www.rpshares.com
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