Gold becomes battleground for bulls and bears

New York (Sept 16)  Gold has been a battleground for bulls and bears this week, with chaotic price action, said Lukman Otunuga, research analyst at FXTM.

“Bulls found support in the form of geopolitical tensions, dollar weakness and fading rate-hike expectations, which kept prices above $1,315,” the analyst added.

“Sellers were inspired by reports of Republicans releasing their tax-reform framework later this month, which boosted the dollar. Thursday’s positive U.S. CPI [consumer price index] report compounded the initial downside, as expectations over higher U.S. rates increased,” Otunuga noted.

 The winner of this tough tug-of-war may well be determined by where prices conclude this week. A weekly close below $1,315 signals the end of the bullish trend on the daily charts, with the next target being $1,300

 In an alternative scenario, a weekly close above $1,340 should open the gates towards $1,350 and higher. As of 9:38 a.m. EDT, spot gold was down $4.80 to $1,324.20 an ounce.

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