Thursday, April 13, 2017
Today’s Spotlight Market
Geopolitical rigidity and out of doors market help have been a driving pressure behind Gold’s current rise. Last week’s US air strikes on Syrian targets has created pressure between the US and Russia. US Secretary of State Rex Tillerson was in Russia to attempt to clean over relations between the 2 superpowers. Russian President Vladimir Putin, with no proof, has claimed that the US is planning proof implicating the Syrian authorities in utilizing chemical weapons. The US has accused Russia in both being complicit with or oblivious to Syria’s use of sarin fuel on its individuals. This has triggered defensive shopping for of Gold.
In addition to the tense relations between Russia and the US, North Korea has develop into more and more belligerent of late, which probably has been a explanation for concern for not solely the US, but in addition neighboring China. The Trump administration has been trying to leverage China with a greater commerce deal in the event that they help the US in reigning in North Korea. The US has participated in naval workouts with Japan close to the Korean peninsula in a present of drive, together with dispatching a strike group within the area.
Geopolitical danger is not the one driver of Gold. The international financial system has proven elevated indicators of life, which has the potential to drive inflation. The weaker than anticipated March job numbers recommend that the Fed might push again fee hikes till later this yr. Traders consider the central financial institution will increase charges one other two occasions this yr. The US Dollar Index has tumbled since final week. The dollar had been rebounding, however took a tumble after the weaker job numbers, additional bolstering metallic costs.
Turning to the chart, we see the June Gold contract breaking by way of near-term resistance across the 1260 degree and pushing towards the 1300 mark. Resistance at 1300 could possibly be a serious hurdle for the Gold market. Prices are buying and selling above the 200-day shifting common, which might be seen as bullish going ahead. It is of curiosity to notice that the momentum indicator is displaying some bearish divergence from costs and the RSI.
Rob Kurzatkowski, Senior Commodity Analyst
SOURCE: FuturesBlogs – Read complete story here.