Before the Bell
- Gold is higher as markets digest EU issues and diminished likelihood of a US Fed rate hike
- The USD is stable after a week of selling has eliminated the post election Trump rally
- German factory orders, EU politics, and Draghi are of note today
Precious Metals
Gold is up in spite of a flat dollar. Signs of speculative money placing bets is showing now, as Gold benefits from so-called 'safe-haven' status. Reasons given are Trump policies, EU politics, and follow through on Friday's Jobs data postponing a rate hike. April futures are flirting with their highest close levels since November. The half-full view would see this as more decoupling from the USD and further remonetization. The half-empty side remembers Gold and the USD rising in tandem usually ends poorly for Gold. Both are right.
Gold is being further recognized as money in its own right and that is the foundation of the market's change since 2007. Shorter term, USD/Gold positive correlations are common during crises, but are susceptible to perception that a crisis is over and a sell-off. Examples include Brexit Crisis behavior which played out slowly, and US election night which played out at lightning speed. Today's behavior so far can be see nas noise for now. but if EU/ Trump uncertainty persists, there will be 2 drivers of Gold's rally. Trade accordingly.
Gold- At RSI Resistance
Silver- Above RSI resistance.
Interactive charts HERE
USD Trump-elation is Over
CFTC data shows net bullish positions fall to November levels and the Dollar extended its losses to 6 weeks.
EU Info
Draghi will speak today with accelerating inflation likely one of the prime topics of discussion. German factory orders and French politics are also notable.
German Manufacturing rises at an accelerated pace
French/ German Bond Spreads Blow Out More on Political Uncertainty
FWIW:Trade War Fodder
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