The volatility has again conquered the forex market and most of the leading investors are making a decent profit in trading due to the high liquidity. In the last trading week, the dollar lost its ground against its all major rivals and push the price of gold higher in the market. The price of gold found a strong support level after hitting the critical support level at 1122.27 in the market. The green bucks gained its strongest momentum in the global market after the FED hike their interest on the basis of 25 points. Since the price of gold is measured in the dollar a slight change in the interest rate of the green bucks significantly affect the gold market. Most of the traders were overly cautious about the falling price of the gold since FED chairperson Janet Yellen stated that they are going for at least three rate hike in this year. If the FED manages to go for three rate hike program in the global market then we will see a sharp decline in the price of gold in near future. However, in the last week, the gold bulls were completely dominating the market as the dollar lost its ground due to a weak news release in the market.

The sharp rise in the price of gold: In the last Friday the price of gold secured two months high in the global market in the event of Mr. Trump statement regarding the precious metal. He deliberately gave an open speech to boost the price of gold in the global economy so that in near future the price of a yellow metal trade in an expensive rate. The price of gold traders at $1206.15 on the New York Mercantile Exchange in the Comex division. The price of yellow matter gained by 0.40% in the global market which was pretty much close to the two months high. All the professional gold investors are now on the sideline since there is a strong resistance ahead and in order to go further up the buyers need to give some serious effort in the market. Though the green bucks slipped in the last week but still it remains broadly supported in the global economy. All the professional gold investors are now waiting for the unemployment claims data since it will greatly help them to understand the next movement of the gold market. The forecasted data for this upcoming news release is 247k and a better data will bring back the sellers in the market with fresh power.

FED creates the threat to the gold bulls: The green bucks have erased most of its strength in the global market in the last week since Mr. Trump failed to keep his promise regarding increasing the fiscal spending and tax cut policy. Due to this speech, the dollar gained a huge strength in the global market and pushed most of its major rivals on the ground. But over the course of time the market has absorbed the speech output and now it has started to react to the fact. However, the green bucks are still holding its ground firmly in the market since FED chairperson stated that their economy is doing significantly well and if things continue like this they are going to implement another rate hike very soon. Most importantly the central bank of USA will also pressurize the FED for at least two rate hike in the global market before the month of November so that they can adjust their inflation rate. However, some of the researchers are now thinking that the central bank might loosen their strict approach in the near future so that the FED doesn’t come up with an immature rate hike.

Political impact in the gold market: Most of the leading investors are now in doubt about the three rate hike program in the global economy since possible three rate hike by the FED in the same year will be extremely difficult. The U.S government need to perform extraordinarily well in all of the sectors for two rate hike. Most importantly if they don’t come up with their rate hike program very soon then the central bank will fail to readjust their current inflation rate and the economy will face longer term consequence in the global market. The current Jobless claim data in the U.S economy is significantly good and housing data is also providing fuel to the dollar bulls in the market. However, since the newly elected president, Mr. Trump has already failed to take initiative regarding increasing the fiscal spending many researchers are now thinking that the dollar will tumble in near future which will ultimately push the gold market higher. In the last week the China’s Gross Domestic product increase by 6.8% in the global market which resulted in 0.1% gain. Such a decent gain from the Chinese economy also gave the gold bulls a decent bullish thrust in the market. On the contrary, the price of silver went down by 0.02% and traded at $16.998 a troy ounce and the price of the copper traded at $2.595 pound.

Summary: Due to the recent slip of the U.S dollar index the price of gold is showing a great deal of bullish pressure in the market. Moreover, Mr. Trump is also giving a decent boost to the gold market. On the other hand, his failure to keep his commitment to increasing the fiscal spending is also supporting the gold buyers in the market. Everything is pretty positive for the gold bulls but the project rate hike by the FED is now the major threat in the market.