- Dollar bulls have gained more confidence
- Oil prices have eased off further from their previous high
Precious Metal is firmly in a downtrend and this is mainly due to the strength in the dollar index which is trading at a significant level. The dollar bulls have gained more confidence after the price broke its previous resistance of $95, a level not seen since last October. This is mainly because traders do think that the Fed would remain aggressive towards their monetary policy. Trade tariffs, an event which has kept a large number of investors on the side lines, still kept the gold buyers out of this arena. This is mainly because no one sees that trade tariff’s strength can actually empower the dollar strength. Having said this, the dollar move is way over extended and there is a strong possibility of small pull back which could bring life for gold.
OPEC’s meeting today remain the central point of focus amidst oil traders. Oil prices have eased off further from their previous high as traders reacted to signs that Iran may support for a small OPEC supply increase. If Iran does end up backing the OPEC’s supply cut, this would be an important signal for the US. Iran is in a negotiation mode again and the Trump administration should pay attention to this. Investors should not ignored this signal as well. This is because Trump admienistration may end up opening the negotiation door again for a new deal
