Gold Prices hit a Five week High

The price of spot gold (XAU/USD) has now hit a five week high as a bout of risk aversion has pushed Treasuries upward, rates lower, boosting the appeal of the non interest yielding gold. However, much of the overnight gains were erased by the end of the North American trading session as equities recovered from session lows to close a tad higher. This threw a wrench into the risk off dynamic.

Investors are now looking towards the release of the minutes from March FOMC meeting. Gold could lose support and turn lower if the minutes suggest that that most central bank officials’ forecast for the 2017 rate hike path is more bullish having a  greater impact of inflationary fiscal policy. Should the Fed’s tightening be more independent of Trump administration’s ability to fulfil campaign promises, the market for the precious outlook may turn more bullish.

Gold Daily Technical Analysis

Using the above daily MT 4 cart, we will now discuss today’s daily technical analysis. The price of the yellow metal put in a shooting star below the key pivot lining up at the February swing high. This level is at $1,263.88 per ounce. This hints at a possible move lower. There is also negative RSI convergence supporting this hypothesis.

Should there be a daily close below the first downside barrier at 1236.82, then the next downside barrier to come into play lines up at $1,220.18 per ounce.