Market News & Analysis
Gold’s counter rally coming to an end?
Gold daily, are we seeing the current counter rally starting to run out of puff? Overnight price fell $5.56 as the USD made a comeback. The USD rallied as the US 10 – Year was yielding at 2.25%, its lowest level since September 2017. For now, this looks like having a negative influence on gold.
Stocks also dropped on the interest rate news, in weeks gone by we have seen gold rally as stocks declined but this was not the case last night. Has the inverse relationship changed? For now, it looks like the USD strength has come back as a deflator for gold’s price. The trade war continues but has eased back, more worry about its effects on the global economy has been coming under focus. This could also be a negative for gold as its widely used in manufacturing and global slowdowns can hurt demand.
Looking at the Gold’s daily chart, price remains in a downtrend, sellers rebroke the main trendline overnight. On the short term, price remains range-bound despite last night’s selling due to two higher low’s and support at 1270 that has rejected 3 tests so far. Today we’re watching the current candle to see if it forms a new failed rally, this show’s sellers remain in play and price may look to retest 1270. A break of 1266 cancels out the current range as a new lower low would have formed suggesting the current downtrend has further to run.
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