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
Bullish
Oil - US Crude
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
Wall Street
Bullish
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
Mixed
GBP/USD
Bullish
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
More View more
Real Time News
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/h0TmJcZeqr
  • $USDCAD sold off aggressively last week, putting it into position to test the important 2017 low; trading bias is neutral to bearish. Get your market update from @PaulRobinsonFX here: https://t.co/sphxUAW9TB https://t.co/ZhsTeJOOM8
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/qP96xmgDVn
  • The pro-risk Australian Dollar may extend gains after the record miss in US jobs data, amplifying dovish rhetoric from the Federal Reserve and keeping the Dow Jones and S&P 500 intact. Get your market update from @ddubrovskyFX here: https://t.co/yf8mPX3O3W https://t.co/uCCmjaxUhF
  • Who else is keeping close tabs on Dogecoin $DOGE this weekend? All eyes on Elon Musk @elonmusk, the proverbial 'Dogefather,' and his Saturday Night Live @nbcsnl performance kicking off at 11:30PM ET. The #crypto is already looking nice and perky following that trendline break! https://t.co/nrQsnlUqWj https://t.co/4lOz6NLQTG
  • There is some very interesting event risk over the opening half of this coming week of trade. It starts with Elon Musk hosting SNL tonight for Dogecoin traders and moves into US inflation data to as means to stir the ongoing Fed debate and Dollar https://www.dailyfx.com/forex/video/daily_news_report/2021/05/08/Dollar-Tumbles-Dow-Hits-Record-Highs-and-Dogecoin-Traders-Tune-In.html https://t.co/LXhjv7ToWC
  • It was a big week for Gold bulls and Gold prices broke out to fresh two-month-highs, finally taking-out the 1800 level along the way. Get your market update from @JStanleyFX here: https://t.co/D222Ni37Dv https://t.co/KcMYyx3Ro4
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/PjywaPeUsl
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/BdgFmkRxVw https://t.co/AjOSPzOFLb
  • What are some trading takeaways from 2020, as we jump into the new year? Find out with your free guide here: https://t.co/e7udCTJlmf #DailyfxGuides https://t.co/eqklbOEJMa
Gold Price Trades to Fresh Record High Amid Extreme RSI Reading

Gold Price Trades to Fresh Record High Amid Extreme RSI Reading

David Song, Strategist

Gold Price Talking Points

Gold trades to a fresh record high ($1945) ahead of the Federal Reserve interest rate decision on July 29, and the price for bullion may continue to carve a series of higher highs and lows as the Relative Strength Index (RSI) pushes deeper into overbought territory.

Gold Price Trades to Fresh Record High Amid Extreme RSI Reading

The price of goldhas traded to fresh yearly highs during every single month so far in 2020, and the extreme reading in the RSI is likely to be accompanied by higher gold prices amid the behavior seen in February.

In turn, the bullish price action may carry into August as long as the RSI holds above 70, and current market conditions may keep gold prices afloat as the Federal Open Market Committee (FOMC)vows to “increase its holdings of Treasury securities and agency MBS (Mortgage-Backed Security) and agency CMBS (Commercial Mortgage-Backed Security) at least at the current pace.

Image of Federal Reserve balance sheet

Source: FOMC

Looking ahead, the Fed’s balance sheet looks poised to cross back above $7 trillion as it expands for the second consecutive week, and more of the same from Chairman Jerome Powell and Co. may heighten the appeal of gold as the committee remains “committed to using our full range of tools to support the economy in this challenging time.”

With that said, it seems as though the FOMC will rely on its lending facilities as well as its asset purchases to support the US economy, and the threat of a double-dip recession may push the central bank to expand the size and scope of its quantitative easing (QE) programs as Fed officials show little interest adopting a yield caps or targets (YCT) policy.

Image of IG Client Sentiment

Until then, it remains to be seen if the crowding behavior in the US Dollar will also carry into August as the IG Client Sentiment reportcontinues to show retail traders net-long USD/CHF, USD/CAD and USDJPY, while the crowd remains net-short NZD/USD, AUD/USD, GBP/USD and EUR/USD.

The net-long US Dollar exposure persists even though theDXY index continues to track the downward trend from the March high (102.99), and the low interest rate environment along with the ballooning central bank balance sheets may continue to act as a backstop for the price of gold as market participants look for an alternative to fiat-currencies.

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss potential trade setups.

Gold Price Daily Chart

Image of gold price daily chart

Source: Trading View

  • The technical outlook for the price of gold remains constructive as it trades to fresh yearly highs during every single month so far in 2020, with the bullish behavior also taking shape in July as precious metal tags a new 2020 high ($1898).
  • The price of gold cleared the 2012 high ($1796) as the Relative Strength Index (RSI) established an upward trend in June, with the recent strength in the price of gold pushing the indicator into overbought territory for the third time this year even though it snapped the upward trend carried over from the previous month.
  • The extreme reading in the RSI is likely to be accompanied by higher gold prices amid the price action seen in February, and the bullish behavior may persist as long as the indicator holds above 70.
  • As a result, topside targets remain on the radar as the price of gold clears the previous record high price recorded in September 2011 ($1921), but need a close above the Fibonacci overlap around $1907 (78.6% expansion) to $1920 (161.8% expansion) to bring the $1971 (100% expansion) to $1985 (261.8% expansion) region on the radar.

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

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

DISCLOSURES