Forex Today: Gold Smashes Record High

The price of Gold spiked up strongly to reach a new all-time high price a few hours ago.

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  1. Gold sparked sharply higher during the Asian session earlier to a new record high price of $2,135 before giving up some of the gain quickly. The price shaded to an all-time high last Friday, but barely. The move is strong and impressive and is likely driven by a soft US Dollar on a more dovish Fed, and the return of strong risk-on sentiment, which Gold is typically positively correlated with. This breakout is attracting trend traders on the long side.
  2. Bitcoin has risen strongly during recent days to reach a new 18-month high above the big round number at $40,000. This will be an exciting time for Bitcoin bulls and trend traders on the long side. Again, Bitcoin tends to be positively correlated with risk sentiment, so the risk-on atmosphere is likely helping to drive its price firmly higher.
  3. The long-term bearish trend in the US Dollar is a key driver in the Forex market, pushed by growing sentiment that the Federal Reserve has ended its current tightening cycle, and will begin to cut rates. Markets are now pricing in a 60% chance of a rate cut by the Feb by March 2024. However, since this week’s open, the US Dollar has gained a little ground. Since the Tokyo open, the Japanese Yen has been the strongest major currency, while the New Zealand Dollar has been the weakest.
  4. Cocoa futures are continuing to rise strongly and closed yesterday at a new multi-year high. This commodity will be very interesting to trend traders on the long side.
  5. There are no high-impact data releases due today, and it is a typically quiet Monday, so with the exceptions of Bitcoin and Gold, it may be a quiet, dull day in the market.
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.