There has been a decent bullish move in the gold market from the very beginning of the year 2017 as the dollar slipped against its all major rivals in the global economy. The price of gold started its bullish recovery in the market after hitting a critical support level at 1122.04 in the global market. The U.S dollar gained its strongest bullish momentum in the market upon the rate hike on last December by FED.There FED hikes their interest rate on the basis of 25 points in the global market and also stated that they are going for possible three rate hike in the year 2017.During that time the U.S dollar index which is the measure of the overall value of the green bucks strength against the six major currency pairs in the global economy. However, the green bucks lost most of its bullish strength in the global market after the newly elected president Mr. Trump failed to keep his promise regarding the tax cut policy and increment in the fiscal spending. On this event, the gold market rallied significantly higher in the global economy breaking critical resistance level in the market.
There has been a massive chaos in the global market in the last week as the investors were in doubt about the next movement of the green bucks. Though the dollar tried to recover some of its losses against its major rivals in the global market but eventually bearish took control of the market prior to market closing. There has been a strong negative U.S consumer sentiment in the recent days Mr. Trump failed to keep his promise as the newly elected president of U.S. After the U.S presidential election held on 8th November 2016 he stated that fiscal spending will be increased and tax cut policy will be implemented soon to ease the sufferings of the U.S citizen. However, three months have been passed there has been no initiative from the Mr. Trump to keep his promise and most importantly he has been creating extreme sentiment into the consumer’s mind. If things continue to go like this than there is strong chance that we will see a long-term weakness in the greenbacks. Due to the recent weakness of the green bucks, the Aussie dollar has broken a critical bearish trend line in the market which clearly impose a threat on the dollar bulls.
There has been a massive confusion into mind of gold investors in the last year as the price of yellow metal sank into the market due to the intense heat of the green bucks. Most of the gold investors were overly cautious about the gold price since it was breaking critical support level one after another. The price of gold is measured in the dollar so a slight variation in the value of the green bucks significantly impacts the gold market in the global community. The U.S dollar gained its first bullish momentum in the market on 8th November during the U.s presidential election held on 2016.Mr. Trump becomes the newly elected president and gave the dollar its first strongest boost in the year by stating that they are going to increase the fiscal spending and going to inaugurate tax cut policy in the near future. Such an optimistic statement from the newly elected president created extensive positive consumer sentiment and push the green bucks higher in the global market. On that event the price of gold sharply dropped in the market as the weight of the green bucks was significantly heavy in the global world.
There has been a massive chaos in the global market from the very beginning of the year 2916.Most of the professional traders were cautiously waiting for the rate hike decision from the FED from the very beginning of the year 2016.The performance of the U.S economy was significantly good in the last two couple of months and this helped the FED to hike their interest rate in their last FOMC meeting minutes. The dollar started to gain its strength in the global market after the U.S presidential election which held on 8th November 2016.The dollar gained a significant amount of strength in the global market after U.S president Mr. Trump stated that the U.S government will increase the fiscal spending and they will also work with the current tax conditions of the U.S citizen. Read more