In early trading gold bugs are pushing the shiny metal slightly higher above the $1,200 level.
Gold (GLD, quote) has moved lower more than 8% for the first two months in 2015 as the U.S. dollar (UUP, quote) continues to remain strong and speculation the Fed will begin to hike rates sooner than originally thought.
Price began to move off a 7 day low ($1,190) yesterday on Fed Chair Janet Yellen’s prepared marks. The key section responsible for pushing price higher was…its “unlikely” … economic conditions would warrant a rate increase…”at least the next couple of FOMC meeting”. This would effectively push the possibility out pass the June meeting effectively no sooner than the September meeting.
Fed Chair Yellen walked a fine line successfully and held comments to the statement not allowing any new or additional information during the yesterday’s testimony. Analysts are looking for the same stance in today’s House Financial Services Committee today that we saw in the Senate Banking Committee.
Although the two days of testimony has given gold bugs a glimmer of hope to push prices higher the chart remains in a strong downward trend. As I like to say there is no room for hope in investing/trading. Which means until the chart indicates a shift of sentiment and direction I’m on the sidelines for gold.