Gold Is Vulnerable To A Correction In The Short-Term…Prior To Month-End

Gold prices look set for their first decline in seven trading days today. Gold fell over 1.1 per cent during Asian trading hours and has remained weak in European trading. 

Gold fell as traders took profits on their recent rapid gains. A slight change in the Federal Reserve’s ‘mood music’ with hints that aggressive interest rate cuts may not happen may also have contributed to gold’s pullback as the dollar rose.

Gold has risen in the six previous consecutive trading sessions and gold prices reached a more than six-year high of $1,438.60 on Tuesday. Given the speed and scale of the recent rise in gold, profit taking and a correction was to be expected.

It is gold’s biggest percentage decrease in almost three months and follow through selling will likely be seen.

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