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Gold daily update for 12th October 2017

BY DEB SHAW | 

After rising for most of this week, gold is continuing to strengthen this morning. The preciously metal was previously looking oversold in the short-term time frame and was due for at a rebound. Yesterday, we upgraded our short-term outlook on gold to bullish and our medium-term outlook to neutral. Looking at odds from betting markets, Jerome Powell is now the front-runner to replace Janet Yellen as the future Fed chair. Given his fairly dovish views, markets are adjusting their future interest rate expectations. Given gold's sensitivity to real interest rates, this is a good tailwind for the precious metal. While we still don't believe the choice of the future Fed chair will have a long-term impact on the dollar, in the short-term gold doesn't need a strong catalyst to keep rising. 

Looking at technical indicators, gold is neither overbought nor oversold today and is trading within normal conditions. After its most recent bottom close to $1,270, gold is now above $1,294. 

Updated 
Outlook
Neutral

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