Gold And The Fed Rate Hike
(Kitco News)- Gold continues to trade in the pattern that has developedsince the Fed began raising rates. This consists ofa weakening pattern into the anticipated Fed meeting, a blip lower onthe announcement and then a strong rally. We suggested that gold wouldpotentially see a $1,307 print ahead of the announcement, with a suggestion toenter, when the news broke. The initial bounce to the $1,327 level was withinreason but then gold prices blew higher on concerns of other developments.China's push-back on proposed U.S. tariffs worried the market and hurt the dollar as traders'concerns about China's continued support ofthe U.S. treasury market came into focus. Trade fears with China have impacted not only the dollar but equitymarkets, which tested their February lows. President Trump's replacement of H. R. McMasterwith John Bolton, as National Security Advisor worried the market in respect toNorth Korea, as Bolton is considered a more aggressive war hawk. There was enough turmoil to force a short squeeze in the metals. The market is close to abreakout, but the technical picture requires a bit more work. We see continued resistanceat the $1,357 level and the market requires further short-term dollar sellingto break through this line. Initial support restsat $1,342.
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