News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bearish
Wall Street
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bullish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • MACD who? The Moving Average Convergence Divergence (MACD) is a technical indicator which simply measures the relationship of exponential moving averages (EMA). Find out how you can incorporate MACD into your trading strategy here: https://t.co/ZNs4Qi8ieG https://t.co/egstowtltH
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.12% 🇬🇧GBP: 0.09% 🇪🇺EUR: 0.09% 🇦🇺AUD: 0.04% 🇨🇦CAD: 0.01% 🇳🇿NZD: -0.01% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/D9tyhgy0CG
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 90.65%, while traders in Wall Street are at opposite extremes with 71.89%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/YldZ1a7abi
  • Update on #Cryptocurrencies #BITCOIN -2.72% #BITCOINCASH -5.01% #ETHEREUM +5.15% #RIPPLE -4.21% #LITECOIN -0.24% #DOGECOIN -5.15%
  • Tokyo Governor Yuriko Koike asked central government to declare state of emergency -BBG
  • Recessions can devastate the economy and disrupt the fortunes of individuals, businesses, and investors. But economic decline in the business cycle is inevitable, and your trading can be defined by how you respond to crisis. learn how to prepare here: https://t.co/e4CnobJCss https://t.co/EXYkozlj21
  • 🇯🇵 Foreign Bond Investment (17/APR) Actual: ¥906.5B Previous: ¥1715.5B https://www.dailyfx.com/economic-calendar#2021-04-21
  • Heads Up:🇯🇵 Foreign Bond Investment (17/APR) due at 23:50 GMT (15min) Previous: ¥1714.4B https://www.dailyfx.com/economic-calendar#2021-04-21
  • Fitch Ratings: Australia-China Trade risks are mitigated by co-dependencies -BBG
  • There’s a strong correlation between interest rates and forex trading. Forex is ruled by many variables, but the interest rate of the currency is the fundamental factor that prevails above them all. Learn how interest rates impact currency markets here: https://t.co/J0EPMD2Cfi https://t.co/Ul5GRGiYXb
Gold Prices Drop as Fed Rate Hike Odds Rise

Gold Prices Drop as Fed Rate Hike Odds Rise

Jeremy Wagner, CEWA-M, Head of Education

Talking Points

-Gold prices test triangle support in the previously cited $1311-1320 zone

-The Fed is trying to invigorate September 21 as a live meeting with a possible rate hike; odds now at 42%

-The higher probability pattern appears to be a triangle which suggests higher prices towards $1375

On August 15, we had written how the $1311-1320 price zone for gold prices would be an area of interest for traders. This is a price zone where if bulls were going to appear, they would need to do so prior to $1311 which corresponds to the July 20 low.

The recent comments by Fed Chairwoman Janet Yellen at the Jackson Hole meeting did strengthen the Dollar which pushed gold prices lower. Recently, the Fed has been trying to get traders to believe that there is a potential for rate hikes coming so the market doesn’t become complacent. The Fed Fund futures are projecting a 42% chance of a rate hike in the September 21 meeting, which is the highest level in 3 months. What makes this number more interesting is that this meeting is just over 3 weeks away.

This creates a pressure cooker environment for gold prices. At 42%, a ‘no hike’ in September becomes a disappointment for those planning for it and may send gold prices higher. If they do hike in September, then you have 58% who were not expecting it and may need to play catch up which could send the Dollar soaring, which the Fed is not particularly interested in.

Gold Prices Drop as Fed Rate Hike Odds Rise

Chart prepared by Jeremy Wagner

From a technical perspective, the $1311-1320 zone is still an area of interest. If this zone holds, look for prices to move higher and retest the highs near $1375 and possibly higher towards $1435.

A break down below $1311 suggests that another pattern is in play and opens the door to $1250 and possibly $1200.

To read our quarterly forecasts for Gold or, download our quarterly forecast here.

See gold trader positioning here.

Why do many traders lose? This could be why.

Suggested Reading: Gold Prices Grind Sideways in a Triangle

---Written by Jeremy Wagner, Head Trading Instructor, DailyFX EDU

Follow me on Twitter at @JWagnerFXTrader .

See Jeremy’s recent articles at his Bio Page.

To receive additional articles from Jeremy via email, join Jeremy’s distribution list.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES