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GOLD: Bullion Reaches New High On Fed Rate Cut Expectations & Weaker US$

GOLD
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Gold prices have continued to rise during APAC trading today as not only is the Fed expected to cut rates for the first time this cycle on Wednesday but there are material expectations that it could be by as much as 50bp. Lower rates are supportive of gold given that it is a non-interest bearing asset. Bullion made a new record today rising to $2589.03/oz. 

  • It rose 0.8% on Friday to $2577.70 and is 0.3% higher today to $2585.80. The USD index is down 0.2%, pressured by the apparent attempt to assassinate former President Trump, which is also supporting gold prices.
  • Bullion has been supported by geopolitical uncertainties over this year. On the weekend, Houthi rebels launched and landed a missile in Israel but without any damage. While Russia is bombarding the strategically important town of Pokrovsk, Ukraine.
  • Gold prices have broken above resistance at $2584, 1.764 projection of the Jul 25 – Aug 2 – Aug 5 price swing, opening up $2600, round number resistance. Recent session moves have maintained the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull-mode set up signalling a clear uptrend.
  • The USD OIS market has just over 1.5 25bp rate cuts priced in.
  • Later the NY Empire manufacturing index for September and euro area July trade data print. The ECB’s Lane and de Guindos make appearances today. 
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Gold prices have continued to rise during APAC trading today as not only is the Fed expected to cut rates for the first time this cycle on Wednesday but there are material expectations that it could be by as much as 50bp. Lower rates are supportive of gold given that it is a non-interest bearing asset. Bullion made a new record today rising to $2589.03/oz. 

  • It rose 0.8% on Friday to $2577.70 and is 0.3% higher today to $2585.80. The USD index is down 0.2%, pressured by the apparent attempt to assassinate former President Trump, which is also supporting gold prices.
  • Bullion has been supported by geopolitical uncertainties over this year. On the weekend, Houthi rebels launched and landed a missile in Israel but without any damage. While Russia is bombarding the strategically important town of Pokrovsk, Ukraine.
  • Gold prices have broken above resistance at $2584, 1.764 projection of the Jul 25 – Aug 2 – Aug 5 price swing, opening up $2600, round number resistance. Recent session moves have maintained the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull-mode set up signalling a clear uptrend.
  • The USD OIS market has just over 1.5 25bp rate cuts priced in.
  • Later the NY Empire manufacturing index for September and euro area July trade data print. The ECB’s Lane and de Guindos make appearances today.