(MENAFN- DailyFX)
Gold Analysis and News:
- Gold Rejects 1800 as USD Picks Up Momentum
- GBP/USD Falling on Higher BoE Rate Expectations is Bad News
Gold Rejects 1800 as USD Picks Up Momentum
A modest pullback in gold having stalled at 1800, while a pick up in USD demand also weighs on the precious metal. However, once again, the 50% Fibonacci retracement of the post-Covid range garners attention. This time keeping gold support in the short run. As shown in the chart below 1760 has been a key level for short-term direction and the fact that gold has held this level, keeps markets looking to the topside. That being said, should we see a break and close below 1760, the immediate focus would be on 1720-25 for bears.
Gold Chart: Daily Time Frame
IG Client Sentiment Signals Mixed Outlook
Retail trader data shows 77.07% of traders are net-long with the ratio of traders long to short at 3.36 to 1. The number of traders net-long is 0.02% higher than yesterday and 0.67% higher from last week, while the number of traders net-short is 6.47% lower than yesterday and 8.10% higher from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall.
Positioning is more net-long than yesterday but less net-long from last week. The combination of current sentiment and recent changes gives us a further mixed Gold trading bias.
GBP/USD Falling on Higher BoE Rate Expectations is Bad News
Yesterday's initial blip higher on UK CPI rising double digits marked the highs of the day for GBP /USD, which has drifted lower to retest 1.20. As I said previously , the BoE is not doing more than 50bps at its next meeting, therefore, the support that the Pound can receive from higher BoE rate expectations is limited at best. The bias remains for lower Sterling.
Source: Refinitiv
MENAFN18082022000076011015ID1104718645
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.