The gold price falls to the lowest level in over a month as the market participants synchronies to Fed tightening tunes supported by several Fed officials. The gold price extends the fall on fourth consecutive week for the first time in 2016. The price closed below 200Wema last week again rejected at the same this week dips to nearly 20Wsma.
Besides, the U.S. dollar index rebounds from October 2015 lows marching to 20Wsma gained 12 days in total of 16 sessions.
IMF: China to increase gold reserves in April from 10.9 to 1808 tons. Russia April increase gold reserves 16.236 to 1476.672 tons. April Kazakhstan increased gold reserves from 3.2 to 231.6 tons. Turkey April increase gold reserves from 2.563 to 481.922 tons. Venezuela March to reduce its gold reserves from 8.5 to 230.2 tons in February fell by 34.2 tons. Belarus in April to reduce its gold reserves from 2.6 to 40.5 tons.
Fundamental negative factors: US federal funds rate futures show traders expect the Fed to raise interest rates in July was 58% probability; probability of rate hike in September was 68%; the probability of rate hike in December was 82%.
Switzerland, official data showed that Swiss exports in April totaled 147.8 tons of gold, up to three months, but the inflow of mainland China and Hong Kong gold is only 23.6 tons, the lowest level since August 2014.
The world’s largest gold ETF – SPDR GOLD TRUST positions fell 0.44 percent the previous day to 868.66 tons.
Stock markets regained across the globe Germany, France, Brian and Dowjones pressure the metal price further.
Bullish views: “For gold, we think that the Fed will raise interest rates make gold under pressure, but this effect is short-term, we expect so its gold hedging properties will be growth in demand, the formation of gold support. Therefore, if the gold price falls, then investors can be regarded as a bargain buying opportunity. ”
Technical view: The price is trading at 1228.00 holding mild gains on early Tokyo session.
The price closed far below 50Dsma but remains above support zone.
Moving averages: 20Wsma finds at 1220.00, 100Dema finds at 1218.00 and 100Dsma&100Dema finds at 1212.00 levels.
On the daily chart, earlier swing low finds at 1208.00 and the psychological support finds at 1200.00 levels.
Since last week, we have been recommending the price must close above 1290.00 to escape the bearish views.
On the downside, we forecast a weekly close below 200Wema 1230.00 is an open target. The metal made a low at 1223.00 rounded almost erased April month’s gains.
Ahead of the U.S first quarter revised GDP Yellen speech weekly support finds between 1218.00,1200 and 1190.00. The monthly support finds at 1180.00 levels.
Bloomberg survey of economists expected a median increase of 0.7%, the former value increased by 1.4%. The initial value of the data two-year low, also the third consecutive year the United States-than-expected GDP data in the open reported by Wall Street Knowledge.
Trading support on Asia session: 1223.00 and 1218.00 levels.
Resistance seems at 1230.00, 1233.00 and 1237.00