GOLD recovering from US inflation concerns
Updated
Precious metals edged higher, partly due to the Commodity Channel Index (CCI) being technically oversold. The CCI indicator, comparable to the RSI, compares the difference between current and historical prices over a set timeframe and indicates whether the market is overbought, neutral or oversold.
On Wednesday, the CCI showed gold was deep in oversold territory and back to levels last seen in late September, just before the market surge. If the market continues to shed this oversold level, gold could retest the 22009/OZ level. ahead of the 20 and 50 day simple moving averages currently at $2,023/oz. and 2,031 USD/oz. corresponding.
On Wednesday, the CCI showed gold was deep in oversold territory and back to levels last seen in late September, just before the market surge. If the market continues to shed this oversold level, gold could retest the 22009/OZ level. ahead of the 20 and 50 day simple moving averages currently at $2,023/oz. and 2,031 USD/oz. corresponding.
Comment
The precious metal is continuing last week’s move despite hotter-than-expected US CPI and PPI data. Market rate-cut expectations continue to be pared back with the first cut now seen at the June meeting with a total of 90 basis points of cuts priced in for this year. In late December, the market forecast the first cut at the March meeting and expected a total of 175 basis points of cuts.
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