Gold Moves Lower But Rebounds

Gold prices crashed lower during the course of the day but it continues to trade within the overall range between the 1320 and the 1345 regions for now. The move lower was driven by the recovery in the stock markets which rebounded all across the globe. We had mentioned something similar in our forecast yesterday where we had said that the gold prices had risen as the funds were drawn out from the stock markets and pushed into the gold market and we had said that the reverse was likely to happen if and when the stock markets recover. That was what we saw yesterday as a combination of dollar strength and a recovery in the stocks pushed the prices towards the 1320 region for a brief while.

Gold Prices Still in Range

This was followed by a recovery in the prices towards the end of the day which helped to push it towards the 1330 region where it continues to trade as of this writing. It remains to be seen which direction the dollar would take as this is likely to have a huge bearing in the way that the gold prices would react in the short term. As we have mentioned, the rise in the gold prices have happened on flimsy grounds and so the gold market is yet to attain a steady footing and that is why we advice caution for our traders.

The oil prices continued to consolidate below the $64 region for most of the day today as the prices were locked in a range. There was not much by way of fundamentals to drive the oil prices in any specific direction and it remains to be seen whether the oil inventory data from the US later in the day would help to bring back some of the lost mojo of the bulls.

Silver prices also suffered from the fall in the gold market and they followed suit but the recovery has been muted. The prices continue to trade below the $17 region which means that the bears remain in control in this market.