Marex Spectron Bullion Thoughts

It would seem that the market has looked out of the window and decided that the summer lull is already upon us. Boring unfortunately does not really do justice to the recent moves and I see very little changing in the near future.

The same old issues dominate, namely the dollar, yields and oh yes, our favourite President, Donald Trump. Love him or hate him, the gold market would have been even quieter this year without him. As such, I expect the markets to remain in a sideways mode, with support down at 1220 and resistance first at 1260, then up at the psychological level of 1300. The Fed trotted out the same old spiel last night with expectations of a June hike holding firm, and the old “buy the rumour , sell the fact” held true and caused a dollar drop and hence a gold gain.

Today sees the latest OPEC meeting in Vienna, which will assess the impact of their agreement to cut production over the last 6 months and possibly look at an extension of this deal. The market expects a 9 month extension and anything outside of this will move the oil price sharply and may well  have a knock on effect in gold. So keep a wary eye on headlines from this. We also have Initial Jobless Claims at 13:30 London time which may provide a firework or two, with expectations at around 240k. I don’t expect much ahead of these events.