Gold Up – Dollar Down – Japan Intervention Talk
Article from Forex FX 4X
Gold moved higher on Tuesday and bullion prices are set for a major monthly rise following from the the Federal Reserve pledge to maintain interest rates at close to zero levels until late 2014. This has likewise put downside pressure on the dollar as the loose monetary policy by the US Federal Reserve has market speculators positioning themselves accordingly.
The precious metal is heading towards a near 11 percent gain in January, this is the highest since a 12 percent gain in August 2011
- The 61.8% Fib retrace of the previous major swing lower is situated just above the 1762 high from 2nd December and is an area of potential resistance on the move higher.
- Further to this the 1800 area previously gave major resistance and a subsequent drop down to the 1530 level.
With regards to the USDX. There is a technical area of confluence between 78.20 – 78.30 which has 38.2 Fibonacci and 50% retrace levels of the respective swings highlighted below.
Price structure historical support levels are seen at 77.89 and 76.50 which could be hit should the current USDX down trend continue. Previous resistance is noted at 79.67 with the 80.00 psych level just above.
One topic that is one the mind of many traders right now is whether the japanese will intervene on the currency markets. The chart below shows how price is moving closer to the all time lows. Jun Azumi, the Finance Minister of Japan advised yesterday that they will adopt firm steps in opposition to excessive volatility. See the USDJPY chart below.
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