Gold Price Looks Oversold as Turkish Lira Rallies Hard
Gold Price News and Analysis
The DailyFX Q3 Gold Forecast is now available to help traders navigate the market.
Gold Trades at an 18-Month Low but Support Nears
Gold continues to slip lower on the back of a strong US dollar and nears an important swing low made on January 2017 at $1,180.6/oz. If this level holds, gold is likely to rebound back through support-turned-resistance at $1,194/oz. and back towards $1,205/oz. Retail sentiment is also turning more positive towards the precious metal. The latest IG Retail Sentiment Indicatorshows that traders remain 85.6% net-long of the precious metal, normallya bearish contrarian sentiment indicator. However recent daily and weekly changes in client sentiment warn that the current spot gold price may soon reverse higher. The RSI indicator is also in oversold territory and may support the precious metal in the short-term.
Gold Daily Price Chart (February – August 15, 2018)
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Turkish Lira Retracing the Gap
The recent sharp USDTRY rally has left a few gaps on the daily chart and the Turkish Lira is currently looking to fill these and at speed. There is a gap on Friday’s (August 10) candle all the way back down to around USDTRY 5.57 which needs to be filled if the pair is to rally back towards 7.000 and higher. Turkey has recently raised tariffs on US imports with alcohol tax being upped to 140% while a range of other goods, from coal to cars, will see tariffs between 10% and 120%. The Turkish Lira traded at 7.20 against the US dollar on Monday, hitting sentiment in the country and forcing the Euro lower.
USDTRY Daily Price Chart (June – August 15, 2018)
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--- Written by Nick Cawley, Analyst
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.