Panic – what panic. Not according to the price of gold and whilst other markets have seen extreme volatility with equities plunging, currency pairs opening gapped down, and the VIX moving violently, gold has continued to remain calm and serene throughout, with hardly a murmur to reflect the turmoil around.
The GBPUSD pair broke out a few sessions ago as we cleared the 1.58 handle. On Monday, we pulled back to find support at that previous resistance barrier, something that you would expect if you use technical analysis for your trades.
This week’s Federal Reserve meeting served as confirmation for investors that the bank is still planning to raise interest rates some time before the end of this year.
The GBPUSD pair broke much higher during the course of the session on Wednesday as we finally cleared the 1.58 level. Because of this, we feel that the market has broken out and it’s only a matter time before the British pound continues to go much higher against all currencies, not just the US dollar.
EURUSD just broke out of its short-term consolidation pattern, signaling that further gains are possible for the pair. Recall that price had traded inside a symmetrical triangle pattern before breaking to the upside past the 1.1300 major psychological resistance.
USDCAD is showing signs of a pullback on its 1-hour time frame, as the pair bounced off the 1.2200 major psychological support area. Price is now testing resistance at the 38.2% Fibonacci retracement level, which lines up with the short-term 100 SMA.
ad news out of Europe, Germany in particular, makes two potentially profitable outcomes significantly more likely. Firstly, the European Central Bank will be more flexible in its efforts to keep Greece in the Eurozone.
Friday’s speech from Fed chair Janet Yellan rounded off a seminal week for the markets, with the US dollar bulls returning in force as her comments continued to confirm the prospect of an interest rate rise during 2015, provided economic data continues to support the mild recovery for the US economy.
Copper, along with several of the other principal base metals fell sharply this week as a resurgent US dollar drove many commodities lower, with both gold and silver also selling off strongly. For the base metals market it was Nickel which saw the most dramatic price moves, falling over 5.5% with copper and zinc both falling over 2 %, with tin one of the few commodities closing higher.
Whilst fundamentals and weather play a huge role in driving the price action for natural gas, the technical picture is now increasingly taking center stage as we move into the warmer months of the year and the commodity responds accordingly.
