Gold recap for 18.12.2015 and FED aftermath
Shifting to commodities - gold hats it fun times with the fed rate hike. Party actually started early for equities (in next post) and for commodities. Gold was dumped half an hour before the official statement after it jumped first to 1077.592. Then as the news came in gold sharply rose to 1077.592 again and, dropped 17 bucks down to 1061.315 and the climbed back again $13 and closed at 1074.415. Opening again on the next hour, gold dropped sharply towards 1068.433, then retracted again. As the whole event ended and market assimilation came in, gold started to drop for the next several hours in-to Asian session.
The drop in 17.12.2015 was crucial, confirming the down-move will continue and so it did towards 1051.805. Yesterday's dollar weakness gave gold some breathing ground and quickly recovered as much as 50% from the total drop in the fed aftermath. Gold closed on 18.12. at 1066.201. 1050.951 is key level for the gold to continue towards 1040 and even lower. 1071.551 on the top side proves to be resilient as well. Gold entering a range? Perhaps.
Gold actually isn't correlated with the feds decisions as there is no direct correlation between gold and hikes. So fed hikes - gold drops to 995 doesn't sound plausible. If inflation ticks up, gold will go up also. Rough times for commodities overall as copper, wti, gold, silver are under pressure for over a year now. I presume there may be a correction first in gold towards 1093.413 or even 1117.219 before bears rush in again (in 2016) and start the next down-leg formation towards 1000. Still on the monthly chart this could be an overall correction losing its steam, preparing for the next gold rush in the future towards 1623.500. This will have to be backed by inflation and dollar softening.