The market mood is upbeat boosting demand for riskier assets, whilst safe havens are under pressure.
Vaccine optimism and hopes that US Congress will agree a fiscal stimulus deal before Christmas sent stocks on Wall Street to fresh record highs. Europe is set to follow the US higher, pointing to a stronger start.
Meanwhile Boris Johnson is due to fly to Brussels later to meet with EC President Ursula von der Leyen in a last-ditch attempt to agree to a Brexit deal. Brexit negotiations aren’t looking as promising as US stimulus talks, even so the FTSE is still finding demand.
FTSE looks to fresh 8 month highs
• The risk on mood is pressuring gold, although prospect of stimulus could support the non yielding precious metal
• Brexit concerns & the first contraction in Chinese CPI in over a decade fail to bring in the bears
FTSE looks to fresh 8 month highs
The FTSE trades 0.25% higher at the time of writing. Yesterday’s selloff failed to break through the ascending trend line which dates back to late November, indicating strength in the price. The FTSE also trades above its 50, 100 & 200 sma on the 4 hour chart suggesting that there could be more buying action on the cards.
Immediate resistance can be seen at 6600 (high 7 Dec) a move through this level could open the door to 6670 (high 6 Mar) an 8-month high.
Gold Under Pressure To Target $1855?
On the flipside, should the price break through the ascending trend line 6560 a move lower through support at 6515 could then open the door to 6450 the 50 sma.
Gold Under Pressure To Target $1855?
• The risk on mood is pressuring gold, although prospect of stimulus could support the non yielding precious metal
• Brexit concerns & the first contraction in Chinese CPI in over a decade fail to bring in the bears
Gold trades -0.4% lower at $1861 at the time of writing, snapping a two-day winning streak with the December rally showing signs of stalling.
Failure to break above the descending trendline dating back to mid August on Tuesday at $1875 portrays underlying weakness in the price of the precious metal and could open the door to support at $1840 the confluence of 100 sma & horizontal support. Prior to that immediate support can be seen at $1855, the overnight low.
Meanwhile 200 sma on 4-hour chart at $1867 could offer immediate resistance in Gold’s fresh upside targeting $1870 trendline. A clear move over $1870 could point Gold back towards $1900 the mid November high.
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