17th October 2017
Gold dropped below the 1300 level later in the evening yesterday as speculation climbed that the next head of the Federal Reserve will be more hawkish. With the bulls failure to break above 7565 that could well be the sign that we are on a leg down now to below 7500 and with some resistance this morning at 7547 we might see a bit more bearishness today. We do have Carney appearing before the UK Treasury Committee today at 09:15 as well as CPI data at 09:30.
FTSE 100 Outlook and Prediction
With the bulls failing to break above the main resistance area we have formed a double top at 7565 now so could well see a bit of a pullback down to the daily support area at 7449, before another attempt to push higher. If the bears were to break that level then we may well have set the high for the moment. The 2 hour chart has gone bearish after that drop yesterday and is showing resistance at the 7547 level, with a red coral trend line at 7549. I am thinking that the bulls may struggle to break above this level today and therefore a short here makes sense. If they were to break it then I am watching 7565 and 7600 for the next resistance areas of note.
We didn’t get much of a bull Monday yesterday for the first time in a while so the bulls might well be running out of steam in the short term, and a trip down to 7500 in the very short term looks likely. It will also be interesting to see what Carney says at the Committee later in terms of further rate movements as it now sounds like he is looking at a rise in November. When he last cut he was mooting about reducing to zero so a bit of a change of tune. Quandary though – deal with inflation or leave low to keep the economy slightly buoyant.
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