Pinnacle Activity Ticker
On Monday Gold Fell $15 an Ounce...so what?
Pinnacle Digest writes: Gold has fallen 1% in value from where it peaked last week after Bernanke’s Bazooka announcement. However, according to Axel Rudolph, senior technical analyst at Commerzbank, "Immediate bullish upside momentum will be maintained while the gold price trades above Thursday's low at $1723.69".
Coincidentally, just two market days after the Fed announcement of QE3, the US announced it was considering approving a release from the strategic petroleum reserve. It’s no secret that energy costs are a main concern for Bernanke when deciding whether or not to implement rounds of QE. Could it be that the US government is working hand-in-hand with the Fed to try and quell any inflationary pressure on oil? Most likely. The announcement from the US government was enough to send crude oil down over $3 on the day. Mission accomplished.
Back to Gold
On Monday gold fell $15 an ounce. Most commodities fell along with it which was believed to be triggered by the US’ announcement to tap the strategic oil reserve. In Ben Traynor’s latest article on the subject he quotes a few key industry pros to get a better understanding of what gold may do next.
"I would simply call it profit taking," says Dominic Schnider at UBS Wealth Management in Singapore.
"I think it's within the range of a solid performance that we've seen over the last two weeks or even a month...nothing unusual."
"I think $1730, levels where the market was before the Fed, will serve as a firm support," adds Yuichi Ikemizu at Standard Bank in Tokyo.
"[Gold could test] last year's peak above $1900 before the end of the year."
Click here to read Ben Traynor’s full article on gold’s recent activity.