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. See our updated Privacy Policy here.

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
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
Oil - US Crude
Mixed
Wall Street
Bearish
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Heads Up:🇯🇵 Core Inflation Rate YoY (MAY) due at 23:30 GMT (15min) Expected: 0.1% Previous: -0.1% https://www.dailyfx.com/economic-calendar#2021-06-17
  • Heads Up:🇯🇵 Inflation Rate Ex-Food and Energy YoY (MAY) due at 23:30 GMT (15min) Previous: 0.3% https://www.dailyfx.com/economic-calendar#2021-06-17
  • Heads Up:🇯🇵 Inflation Rate YoY (MAY) due at 23:30 GMT (15min) Previous: -0.4% https://www.dailyfx.com/economic-calendar#2021-06-17
  • RT @FxWestwater: Australian Dollar Sinks Alongside Commodity Prices as Post-FOMC USD Run Continues Link: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2021/06/17/Australian-Dollar-Sinks-Alongside-Commodity-Prices-as-Post-FOMC-USD-Run-Continues.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https://t…
  • The S&P 500 and Dow Jones could be at risk as retail investors increase their long exposure in them ahead of the Fed rate decision. What are key technical levels to watch out for below? Find out from @ddubrovskyFX here:https://t.co/TkroCgtDLm https://t.co/NwFkkk28Dh
  • RT @FxWestwater: Lean Hogs futures hit limit down, with the worst week since June of last year. Price is cutting below its 50-day SMA and m…
  • So the BoJ is out later today for the #Yen...and as per the usual, at an unspecified time somewhere probably between 2 - 4 GMT Wonder if there is a market out there for those wishing to bet on the time they will release their statement....
  • RT @FxWestwater: #Copper breaking down further from its Descending Triangle, with hardly any reaction from the 100-Day SMA (purple line). A…
  • US Fed’s hawkish surprise deepens USD/ZAR pullback. USD/ZAR technical set-ups and levels to watch. Get your market update from @RichardSnowFX here:https://t.co/rd8kXlUh8m https://t.co/jUyyT4x8hC
  • Continued $USD strength highlights major FX price action https://t.co/09pe1L3DpP
Gold Price Outlook: XAU Coils into May, Will GLD Buyers Hit the Bid?

Gold Price Outlook: XAU Coils into May, Will GLD Buyers Hit the Bid?

James Stanley, Senior Strategist

Gold, XAU, GLD Price Analysis

  • Gold prices have put in almost three weeks of mean reversion after a 20% leap from March lows up to April highs.
  • Will gold bulls jump in to further the trend as price action continues to coil?
  • This week’s economic calendar has a few notable items, key of which is the Non-Farm Payrolls report due on Friday morning.

Gold Volatility Calms After 20% Jump

It’s been fits and starts of volatility in Gold prices so far this year, and that can really extend back to Q4 of 2018 as global markets began to show symptoms of being unnerved by a spate of continued rate hikes out of the Federal Reserve.

It may seem like a different reality but it wasn’t even two years ago that the FOMC was wrestling with market expectations around higher rates. While the Fed had already put in three hikes going into Q4 of 2018, markets were apparently looking for some element of pause as the risk trade collapsed very soon after the start of the quarter; with that sell-off continuing into the Christmas holiday. The Fed even hiked in December to mark four rate hikes in 2018; and in the projections shared at that meeting they said that they were even looking at the potential for two more hikes in 2019.

As we all now know, 2019 didn’t happen like that. Instead, shortly after that fourth rate hike in 2018 various members of the FOMC began talking up the potential for rate cuts and that chorus for cuts only grew louder through the early-part of 2019. Normalcy was restored as US equity markets were back on the bid; and Gold prices benefited mightily as buyers were able to press the matter through the first-half of 2019, creating a strong bullish trend that ran well into the summer.

Learn more about the Federal Reserve and their function within the US and global economy as part of the recently revamped DailyFX Education offering.

Gold Weekly Price Chart

Gold Weekly Price Chart

Chart prepared by James Stanley; Gold on Tradingview

At the core of this drive was the FOMC moving into a more dovish posture and, eventually, cutting rates three times in 2019 versus the two hikes that they had initially projected in December of 2018.

As 2020 has brought an entirely new risk to the table with the novel coronavirus, the Federal Reserve’s stance has been a similar one of accommodation, helping Gold prices to further surge up to fresh seven-year-highs, with a +20% move showing from the March low up to the April high.

Gold Daily Price Chart

Gold Daily Price Chart

Chart prepared by James Stanley; Gold on Tradingview

Gold Prices – Near-Term

At this point, gold prices have been mean reverting for almost three full weeks following that 20% ramp from the March lows up to the April highs. But, perhaps obscuring that prior bullish theme a bit was the context at the time when it started: Gold prices tanked by almost 15% in a week in mid-March. This highlights just how jumpy markets have been around the pricing-in of fears around the coronavirus. That bearish run appeared to emanate from a cash crunch; and as global Central Banks moved to turn up the accommodation, the bullish trend came back to help Gold trade up to fresh highs.

The big question at this point is one of continuation, and this certainly isn’t the first case of digestion seen in the yellow metal after a really big move in one direction or the other. At this point, that bullish bias may remain as attractive, particularly given the fact that many expect the Fed and global Central Banks to remain as accommodative as necessary to help contain the economic fallout from the coronavirus.

Gold Four Hour Price Chart

Gold Four Hour Price Chart

Chart prepared by James Stanley; Gold on Tradingview

--- Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX

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

DISCLOSURES