Gold steadies after sharp fall. What's next

Author: Adam Button | Category: News

Gold up $3 today to $1858

Gold chart
It was a lively start to the year for gold but it's quieted over the past three days as it consolidates near $1850.

It now sits just above the 200-day moving average and just below the 100-day.  It's also halfway between the the November high and low.

It all adds up to an uncertain market. Biden is going to unveil a proposal for trillions in spending tomorrow but rates are rising, bringing competition from bonds. The latest rebound in the dollar is also gold-negative.

There is a seasonal tailwind through February but traditional gift-giving at the lunar new year might not materialize in usual way.

I get the sense that the market wants to see if the Fed is truly serious about letting inflation run hot. If they are, there's a chance that it gets away from the central bank, something that could spark a boom in gold.

For bank trade ideas, check out eFX Plus
By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose