Gold Prices Higher on Weaker Dollar

Gold prices moved higher during the course of the last 24 hours on the back of some weakness in the dollar which came about due to the FOMC announcement. The focus of the markets since the beginning of the week has been firmly on the dollar and the Fed as the market was looking forward to what the Fed was going to do and what the new Fed Chief Powell was going to say. In fact, the expectations were so much that we have been saying that the market was bound to get disappointed irrespective of what the Fed says or does. This is what happened yesterday as the Fed delivered on much of what the market wanted but still failed to satisfy the market fully.

Prices Move Higher

The Fed hiked rates for the first time this year and then went ahead even further as the new Fed Chief expressed a lot of confidence and hope for the US economy. He stopped short of laying down a timeline for the future rate hikes and this served as the disappointment as the dollar sold off across the board and this helped the gold prices to climb above the 1320 region and head towards the 1330 region as of this writing. But the gold prices continue to be within the larger price range and we believe that with all these news and events out of the way, the prices are likely to continue to trade within the larger range for the short and medium term as well. The weight is on the bullish side and hence we are likely to see the prices moving higher for the short term.

Oil prices broke higher towards the highs of its range as the weakness of the dollar seemed to have an impact on the oil prices. With the lack of fundamentals, the oil prices have been driven more by the dollar weakness and the production data and with both the dollar and the oil production being weak, we are seeing the prices move higher and we are likely to see some consolidation at the highs.

Silver prices have also moved higher over the last 24 hours on the back of dollar weakness as the price action follows the pattern set in the gold markets. The prices trade above the $16.5 region and are likely to continue to remain buoyant in the short term.