Gold & Silver Capped By USD Rally

Gold

Gold prices have been broadly higher over the week with price advancing further off the 1700 handle.

However, the market gave back some of those gains on Thursday following the March FOMC meeting on Wednesday. The Fed struck a firmly optimistic view on the economy and raised all of its forecasts for 2021, projecting firm improvements in inflation GDP and labor market conditions.

Despite maintaining its view that rates will remain on hold until 2023, changes in the dot plot suggest there is a growing hawkish shift within the Fed that will need to be monitored going forward.

In light of this meeting, the dollar has turned higher, pulling gold down into the end of the week.

Gold prices were pushed further lower on Thursday as the Philly Fed manufacturing index came out almost twice as high as expected sending the dollar even higher.

Bear Channel Continues in Gold

(Click on image to enlarge)

xauusd

The bounce off the 1700 level has seen price trading back up to just shy of the 1763.88 level. While price remains below here, and with the bear channel top sitting just above, the focus is on a continued push lower with a break of the 1700 level now a risk.

Below there, 1634.74 is the next big support to watch.

Silver

The silver market has seen much more muted price action than gold this week with price action remaining tightly congested around the 26.00 level and the rising channel low.

The downside impact from the resurgence in USD this week hasn’t impact silver as heavily. The market has been underpinned to an extent by the strength in manufacturing data which supports a better demand outlook for silver.

However, with equities pulling back as the dollar rally builds, there are growing downside risks for silver in the near term.

Silver Hovering Around Support

(Click on image to enlarge)

xagusd

Silver prices continue to oscillate around the 26.00 level with the level having attracted plenty of order flow over recent months.

1 2
View single page >> |

Disclaimer: Orbex LIMITED is a fully licensed and Regulated Cyprus Investment Firm (CIF) governed and supervised by the Cyprus Securities and Exchange Commission (CySEC) (License Number 124/10). ...

more
How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.