Friday, 20 February 2015

Gold Price Falls Sharply on Technical Factors, Competition

The gold spot price fell by as much as $23.40 on Tuesday morning due to a slew of technical factors that combined to force gold closer to the $1,200 per ounce level. As of 1pm EST gold’s spot price was $1,209.40, down $19.50 for the trading session.
Gold’s steep decline today has been attributed by Certified Gold Exchange analysts to a variety of factors, including bearish technical indicators that show gold could lose more ground before rebounding. The yellow metal is at a 5-week low right now because the U.S. Dollar Index has been rising steadily for over a month.

Interest rates have been a key driver of gold and silver prices historically, and current gold price movement indicates this is still the case. Although the Federal Reserve’s head, Janet Yellen, has indicated that interest rates will most likely rise in the first half of 2015, the current prime lending rate of 0.25% has served to boost stock indices. Many U.S. stock markets are at or near record-highs or multi-year highs, causing some investors to divert funds away from other assets.
The Fed, meanwhile, will host a Federal Open Market Committee meeting tomorrow afternoon. This meeting could provide clues or outright answers about when interest rates might start to climb.
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