Gold began the day weak, after the US Senate passed its 2018 budget. The budget prevents the Democrats from filibustering Trump's tax reforms. Thus expectations for tax reforms are rising, as the White House now needs fewer votes to make lower taxes a reality. While gold traded as low as $1,280 recently, it is currently trading above $1,283. Earlier in the week, gold was falling on news that Trump is favoring John Taylor to be the next Fed Chair.
Looking at technical indicators, gold is neither overbought nor oversold today and is trading within normal conditions. After its most recent top above $1,300, gold is now below $1,284.
After falling sharply in the third week of October, we are now bearish on gold in short-term. The precious metal fell on news reports that Trump favors John Taylor to be the next Fed Chair. We previously warned that the precious metal was looking oversold and due for a rebound. Gold has since re-entered normal trading conditions, based on various technical indicators on the daily chart.
After falling sharply in the third week of October, we are downgrading gold to neutral in the medium-term. The US dollar and bond yields are rising due to expectations of the next Fed Chair. The precious metal is now below overbought conditions, looking at technical conditions on a weekly chart.