Gold prices move lower over the last 24 hours as the confusion and uncertainty in Germany over the formation of the new government has turned the markets even more choppy than what they were last week. That is why we saw the gold prices move higher during the early part of the day yesterday as the stock markets moved lower but as the day progressed, the stock markets began to recover and this brought in a lot of pressure on the price of gold which responded by moving lower and it now trades in the 1280 region as of this writing.
Gold Prices Likely to be Range Bound
In effect, the prices have been brought back into range over this period and now we are likely to see the gold prices continue to consolidate within the range over the short and medium term. The prices have not been able to make a break in either direction as the prospect of a rate hike in the US in December continues to sway the markets. We are likely to get some clarity on that during the FOMC minutes which would be released later in the week but till that time, this consolidation and ranging is set to continue.
Oil prices continued to trade in a pretty strong manner over the last 24 hours and as we have been saying all along, we think that the uptrend in the oil prices is still intact and any correction should be viewed only as an opportunity to go long on this instrument. This is the same that we said when the oil prices moved towards the $55 region and consolidated over a few days and since that time, we have seen the prices move higher through the $56 region as the bulls have begun to gain control over the prices once again. We are still looking at $60 as the ideal target for the oil prices by the end of the year but that would depend a great deal on the incoming data with regard to production and inventory.
Silver prices have also taken cue from the gold market and moved lower yesterday as the prices moved through the $17 region as the risks faded and the talk about the issues in Germany began to subside. It continues to trade below the $17 as of this writing and is expected to remain weak and range bound in the short term.
This article was originally posted on FX Empire
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