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Geopolitical Uncertainty Rising
Gold prices are starting the week with a bid tone as rising geopolitical uncertainty sees a jump in safe-haven demand. Gold futures are up around 1% on the following firm buying through early European trading as traders digest in the Middle East. The coup against Assad in Syria, following news of US airstrikes against rebels, is adding to the instability in the region. Following news that Israel has launched fresh attacks against Hezbollah targets in Lebanon, after claiming that the group broke the ceasefire first, there is a great deal of uncertainty at the start of the week which looks likely to favour gold for now.
USD On Watch
Looking ahead this week, traders will also be focusing on USD and Fed expectations. Market pricing for a fresh rate cut this month has jumped on the back of last week’s jobs report, despite a strong NFP print, with traders focusing on the lift in the unemployment rate. This week, traders will be watching to see if there was a further rise in inflation last month. Given the built-up dovish expectations, it would likely take a firm upside surprise to derail this outlook. If we see a downside surprise, however, this should cement December rate cut chances, sending USD firmly lower and allowing gold room to push higher.
Technical Views
Gold
Gold prices remain firm above the 2,604.56 level for now and with momentum studies turning higher here, focus is on a break back above 2,684.76 near-term and a continuation back towards the 2,789.40 level. To the downside, 2,530,59 is key support to note.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.