The Bears gain control of GoldTechnical Momentum Weakens
Gold Futures hit an all-time high in 2024 at $2,448 on the June futures contract on April 12. Since then, futures have corrected; however, gold remains firmly above the rising 50-day moving average at $2,244 and well above the 200-day moving average at $2088. The technical perspective shows momentum studies declining, with the 9-day moving average trading below the 18-day.
Stochastics have corrected into oversold territory, and DMI - is below DMI- , indicating that the bears are technically in control.
Tailwinds Continue to Develop
With a 6% chance of a June rate cut, according to the CME's Fedwatch tool, traders are focused on September; swaps are pricing in a 43% chance that the Fed will make its first interest rate hike in the cycle.
Geopolitical tensions, rampant fiscal spending, and central bank buying have been the main drivers and have significantly propelled Gold prices recently.
Industrial Metals Strengthen
Performance remains strong in the Precious Metals space and has continued to spill into the industrial complex. Traders continue to monitor manufacturing, Chinese Economic data, and the U.S. economy.
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*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
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