The yellow metal is falling sharply on Wednesday amid a stronger US dollar on
rising expectations about a rate hike by the Federal Reserve in December. The
ounce broke below yesterday’s lows at $1,114.30 and dropped further.
Recently bottomed at $1106.60 hitting the lowest level since October 2.
Spot gold remains trading near the lows, still holding a strong bearish
momentum.
Technical indicators show oversold readings in every time
frame but the decline does not stop. Today is falling for the six day in a row,
accumulating a decline of more 6.40% from last week highs.
Eyes
on $1100
Greenback is rising across the board, as the US
ADP employment report and Yellen’s
words continue to leave the door open for a rate hike at the next
Fed’s meeting. Gold continues to decline and it could remain weak at least until
the NFP
report.
The next key support is the $1,100 area. During
September it traded momentarily below but quickly bounced back above; on
October, it approached but rebounded to the upside. Now the mentioned level is
exposed and it could be tested. If it remains above, possibilities of a bullish
correction would rise.
