Gold Prices May Fall as Hawkish Fed-Speak Sets Stage for Yellen

Talking Points:

  • Gold prices might tumble if Fed’s Brainard supports another 2017 travel
  • Crude oil cost sensitivity to lapse on API, EIA and WPC news flow
  • See a forecaststo learn what will expostulate bullion and wanton oil in Q3

A lullin top-tier eventuality risk authorised space for gold prices to connect after Friday’s pointy downswing in a arise of June’s upbeat US labor-market data. From here, a muted charity on a information calendar puts Fed-speak in a spotlight.

Comments from Governor Lael Brainard, a Fed’s many outspoken dove, are due to cranky a wires. If even she appears to preference another rate travel in 2017, doubtful financial markets might begrudgingly renounce to a some-more hawkish baseline opinion and send bullion lower. Significant follow-through seems doubtful however as investors wait testimony from Fed Chair Yellen after in a week.

Crude oil prices serve noted time. The peace might be damaged as API weekly register upsurge total are revealed. Official DOE numbers due a following day are approaching to uncover a 2.46 million tub drawdown. If API reports a incomparable outflow, prices are expected to rise. A smaller one will substantially see them tumble further.

Meanwhile, an updated chronicle of a EIA short-term appetite outlook will be released. Another hillside might strengthen bets that flourishing US outlay will continue to equivalent OPEC-led prolongation cut efforts. Absent signs of broadening support for deeper outlay rebate from a sidelines of a World Petroleum Congress still holding place in Istanbul, this might rekindle offered pressure.

Retail traders design bullion to rise. Find out here what that hints about a entrance cost trend!

GOLD TECHNICAL ANALYSISGold prices paused after touching a lowest turn in 4 months. From here, a daily tighten next a 1195.13-99.67 area (March 10 low, 38.2% Fibonacci expansion) targets a 50% turn during 1169.89. Alternatively, a annulment behind above a May 9 lowat 1214.40 – now recast as insurgency – opens a doorway for a retest of a 23.6% Fib during 1236.51.

Gold Prices May Fall as Hawkish Fed-Speak Sets Stage for Yellen

Chart combined regulating TradingView

CRUDE OIL TECHNICAL ANALYSISLike gold, wanton oil prices also paused to gnaw over new weakness. Near-term support stays in a 43.51-79 area (38.2% Fibonacciexpansion, May 5 low), with a daily tighten next exposing a 42.08-35 segment (June 21 low, 50% Fib). Alternatively, a miscarry behind above a 44.96-45.32 section (former support, 23.6% expansion) targets a 47.03-12 operation (chart rhythm point, 50% Fib retracement).

Gold Prices May Fall as Hawkish Fed-Speak Sets Stage for Yellen

Chart combined regulating TradingView

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

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