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Gold Falls Following Fed
Gold prices have turned lower on the back of the Fed meeting yesterday. Despite holding rates steady at this meeting, the meeting showed a clear hawkish skew with the updated dot plot projections showing that the majority of members still forecast further hikes this year. Powell himself noted that July is still very much a live meeting meaning that this month’s pause is already being discounted as traders look ahead and attempt to gauge how the Fed is likely to act. Given its data dependent stance, incoming data between now and the next meeting will be closely watched.
US Retail Sales Up Next
Looking ahead today, the key data focus for gold traders (alongside the ECB meeting) will be the release of the latest US retail sales figures. Given that these figures are a key component of the overall GDP calculation, they are an important insight into the health of the US economy. If the expected weakness (headline exp -0.2% from 0.4% prior, core exp 0.1% from 0.4% prior) shows up, this might push back against the idea of a July hike, leading gold higher near-term. However, if we see any upside surprise, this will likely feed into a hawkish narrative supporting US near-term and pushing gold lower.
Technical Views
Gold
The reversal lower in gold prices has seen the market falling below the bull channel support and below the last structural support level at 1973.51. While below here, and with momentum studies turned bearish, the focus is on a continuation lower near-term with 1871.04 the next downside level 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.