RAPID UPDATE ON SIGNAL Gold (XAU/USD) The current ongo | Focal Community Group (FXSignals)

RAPID UPDATE ON SIGNAL
Gold (XAU/USD)

The current ongoing heated discussion about the federal debt ceiling, leads to a slight panic reaction in the markets and helped gold to (finally) see some tailwind again (and pushed gold above $1.756). Federal Reserve's Jerome Powell and US Treasury Secretary Janet Yellen are currently answering questions from Congress. Critical questions from Republicans showing that there is no immediate support (from Republicans) for raising the limit is leading to this current uncertainty. It would have disastrous effects if both chambers wouldn't agree to lift the federal debt ceiling. However, the Democrats could potentially push this through alone as they have the majority in both chambers. In my opinion, it's just a standard procedure and almost impossible that the rise of the debt ceiling would not come. The market reaction should therefore be seen as an overreaction - it gives us the opportunity to SHORT gold at a better price near Monday's resistance ($1,760). Meanwhile, the USD remains strong, even though US Treasury yields fell slightly. Spikes like this will happen regularly, given that many investors believe that gold is undervalued at the moment.


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Stronger together