3-12-2015 - The risk-off sentiment could not stop the gold falling

[walid]

• The fear of watching lower growth rates in US too following china could contain the market sentiment, after dovish manufacturing released data this week.
• The US blue chips have watched massive falling, after the release of Nov US ISM Manufacturing index has fallen to 48.6 to be weakest since June 2009 and the first in the contraction territory since May 2013.
• This figure came, after Chicago PMI had shocked the market previously by falling to 48.7%, while the market was waiting for retreating to 54 only from 56.2 in October to highlight the current weakness in the manufacturing sector which can be due to the greenback strength amid rising odds of having higher interest rate in US.
• The gold could not get use of the risk aversion sentiment, as it has been still depressed by the expectations of having the first interest rising in US since 2006 next FOMC meeting on 15 and 16 of this month.
• The gold kept its dovish tone longer to reach $1046.30 per ounce which is its lowest level since Jan 2010 because of this same market sentiment which is possessed by a nearby interest rate hiking beginning in US.
• The US treasuries yields were also boosted by these same odds which were dampening the demand for treasuries, despite the risk-off sentiment
• The gold has been under pressure since the FOMC recent meeting which raised the odds of hiking the interest rate in US this year.
• The Fed has shown higher consideration of raising the fund rate next December by saying that it will see next meeting "whether it will be appropriate to raise the target range or not" , after keeping it unchanged between 0 and 0.25% since Dec. 16 2008.
• The greenback has been boosted from another side by the upbeating US labor report of October which made crucial change of the interest rate outlook in US.
• Technically, The Gold downside momentum increased recently, after breaking last Jul. 20 low at 1073.95 to renew today its lowest level since February 2010 and also the lowest since forming it's all times high at $1921 which has been recorded in September 2011.
• The rising of the interest rate outlook in US capped XAUUSD from rising above $1200 per ounce and lead to forming a second top at $1182.90 below its peak at $1191.58 which has been formed on last Oct. 15.
• God willing, after limited rebound this week to $1074.70, The way up is still in need for more reasons to take place, while the falling below $1046.30 can open the way to more downside momentum to test Jan .31, 2010 bottom at $1044, before facing the psychological level at $1000 per ounce.
• Important levels:
• S1: $1044
• S2: $1000
• S3: $904
• R1: $1074.70
• R2: $1097.86
• R3: $1120.90

Have a good day

Kind Regards
FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com