© Dukascopy Bank SA
"The dollar index is within reach of the multi-year high of 100.39. A break of this level would put downside pressure on gold with a break of $1,066 yielding initial $1,045, which is the 2010 low."
- ScotiaMocatta (based on CNBC)
Pair's Outlook
More or less optimistic US statistics used to have a "reminder" effect for investors who switched back to Fed policy expectations. However, Wednesday's move downwards was again limited by July low at 1,070. The bullion is has been pressured by this important support for the second consecutive week. It makes us assume that the bears need more pronounced impetus to send the price towards fresh lows below 1,064 (Nov 18 low). Thursday and Friday are US data-free days, meaning volatility is highly likely to remain restrained.
Traders' Sentiment
Market sentiment with respect to gold remains strongly positive for the moment, being that more than 72% of SWFX traders are holding long positions. However, risks are skewed to the downside as gold seems to be overbought.
© Dukascopy Bank SA