Gold Prices May Fall on Hawkish Fed, US Bond Supply Boost

GOLD CRUDE OIL TALKING POINTS:

  • Gold prices stalling before Fed rate decision, Treasury appropriation news
  • Crude oil prices arise on UK supply disruption, US automobile manners proposal
  • EIA prolongation report, API register upsurge statistics due for release

Gold prices continued to onslaught for durability instruction Monday, with traders understandably reluctant to dedicate one approach or another forward of a arriving Fed rate decision. A travel is not approaching though officials competence dial adult hawkish tongue in a policy statement to claim their autonomy after US President Donald Trump talked down rate hikes recently.

The vanishing interest non-interest-bearing resources is expected to harm a yellow steel in this case. The tumble might be amplified as a US Treasury reveals how it skeleton to account a necessity done incomparable by a $1.5 trillion taxation cut and $300 billion in new spending. Officials pronounced currently that third-quarter borrowing will be $329 billion, adult from April’s $273 billion projection. Added distribution might amplify ceiling vigour on yields.

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CRUDE OIL EYES EIA OUTPUT REPORT, API INVENTORY DATA

Crude oil prices changed aloft as 3 UK oil fields tighten down forward of strikes. Meanwhile, a corner breeze news from a National Highway Traffic Safety Administration and a Environmental Protection Agency pronounced a Trump administration offer to hindrance aloft automobile potency mandate after 2020 will boost US fuel expenditure by 500k barrels per day.

From here, a spotlight turns to monthly EIA prolongation statistics as good as a API guess of weekly register flows. The former will assistance surprise bets on a border to that flourishing US outlay can equivalent direct pressures. The latter will be judged with anxiety to central total due Wednesday that are projected to news a 2.26 million tub outflow.

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GOLD TECHNICAL ANALYSIS

Gold prices remain sealed in a informed operation above a 38.2% Fibonacci expansionat 1217.29. A daily tighten subsequent this separator primarily exposes a 50% levelat 1202.28. Alternatively, a miscarry above support-turned-resistance during 1236.66 opens a doorway for a retest of a 1260.80-66.44 area.

Gold Prices May Fall on Hawkish Fed, US Bond Supply Boost

CRUDE OIL TECHNICAL ANALYSIS

Crude oil prices edged above insurgency during 69.53, targeting a 38.2% Fibonacci enlargement during 71.52 next. A serve pull over that aims for a 50% turn during 72.89. Alternatively, a pierce behind subsequent 69.53 – now recast as support, paves a approach for another plea of trend line support set from early Feb (now in a 66.47-67.72 area).

Gold Prices May Fall on Hawkish Fed, US Bond Supply Boost

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

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