Gold reacts to global fundamentals

Source: Dukascopy Bank SA


On Wednesday, the Bank of England announced that it would buy government bonds valued at a total of 65 billion Pounds. The market took in the news as follows - the bailing out of the government will create more inflation and will force the BoE to hike rates even more intensively. As a result a surge of the GBP against the USD caused a decline of the US Dollar index.

However, in a couple of hours the markets realized that the additional hikes by the Bank of England would result in a deeper UK economic decline in the further future. Namely, the International Monetary Fund made comments and explained how reckless the UK central bank and government were. Due to that reason, the situation, asset prices and currency exchange rates retraced back to Tuesday's levels.

On the gold price charts the event occurred as a spike upwards above the 1,660.00 level. By the start of Thursday's European trading, the price had declined to the support of the 50 and 100-hour simple moving averages and the 1,640.00 level.

A move of the price below 1,640.00 is highly likely set to look for support in the 1,630.00, 1,620 and 1,615.00 levels. On the other hand, a recovery of the commodity is expected to encounter some resistance in the 200-hour simple moving average near 1,655.00 and the Wednesday's high at 1,662.75.
Back to articles

Actual Topics

Thu, 29 Sep 2022 12:13:59 GMT

EUR/JPY surge encounters resistance

Since the last review, the EUR/JPY rate has dipped and found support in the 138.10/138.15 range. Afterwards, a surge followed, which on Thursday was testing the resistance of the 141.00 mark, the 200-hour simple moving average and the weekly simple pivot point at 140.58. A potential surge of the Euro against the Japanese Yen above the 141.00 level could be

Thu, 29 Sep 2022 08:47:13 GMT

USD/JPY is still below 145.00

On Wednesday, the Bank of England announced that it would buy government bonds valued at a total of 65 billion Pounds. The market took in the news as follows - the bailing out of the government will create more inflation and will force the BoE to hike rates even more intensively. As a result a surge of the GBP against

Subscribe to "Fundamental Analysis" feed

Subscribe
To learn more about Dukascopy Bank CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
For further information regarding potential cooperation,
please call us or make callback request.
To learn more about Dukascopy Bank Binary Options / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Dukascopy Bank CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Crypto Trading / CFD / Forex trading platform, SWFX and other trading related information,
please call us or make callback request.
To learn more about Business Introducer and other trading related information,
please call us or make callback request.
For further information regarding potential cooperation,
please call us or make callback request.