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Precious Metals Mixed Post FOMC

Last updated 10/24/2012 2:39 PM EST (GMT -5) 0 Comments - Add your comment

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Fawad Razaqzada

Technical Analyst, GFT

Follow @FawadR_GFT

The US Federal Reserve announced nothing new in its latest FOMC statement this Wednesday evening, disappointing those were looking for further easing clues. This, along with a stronger-than-expected US New Home Sales report, has helped to push the dollar higher. As a result, precious metals are trading lower with gold hovering around $1700. Silver is also weaker but off its worst levels.

As well as a precious metal, silver has many industrial usages and the overnight release of a stronger-than-expected Chinese Manufacturing PMI has raised hopes that the physical demand for the grey metal may be rising. But those expectations were dampened slightly when the eurozone released a raft of disappointing manufacturing PMIs this morning. Nonetheless silver is holding up relatively well compared to gold.

However, technically, silver looks set to fall further before probably rising again from a low of $31 or even $30. Gold is approaching a potential support level around $1690/5, which also ties in with the 38.2% Fibonacci level of the last major rally.

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About The Author

Fawad joined GFT as a technical analyst in 2010 and has since focused on timely market commentary and research for GFT with an emphasis on technical analysis. He achieved his CISI Level 3 Certificate in Investments (Derivatives – Retail) in early 2011.