Daily market commentary: Important day for Gold

Daily Market analysis

ActivTrades’ Market Analysts have prepared for Leaprate their daily commentary on traditional markets for June 20, 2019. See details below:


The US Dollar Index, currently just above the 96 mark, hit a 3-month low on Thursday, in the aftermath of the Fed’s previous day announcement. Most notably, the American central bank dropped the word ‘patient’ from their policy language and marked the intention to “act as appropriate, to sustain the expansion”. In central bank talk this means: ‘Get ready, a rate cut is coming’. Instability arising from trade tensions and inflation below the symmetric target of 2%, were the reasons used to justify this increased dovishness. The North American central bank appears to be totally committed to engineering a soft landing for the US economy, and few will be surprised by a rate cut, that may arrive as early as July.

Ricardo Evangelista – Senior Analyst, ActivTrades


European markets are edging higher today after investor sentiment has been boosted by a dovish Federal Reserve. Even if Jerome Powell remained confident over growth, jobless rate and inflation for 2020, he expressed concerns over rising uncertainties in the mid-term that increase the chances of a rate cut. The central banker then reassured investors by confirming the Federal Reserve “will act as appropriate to sustain the economy”.

As expected, this statement boosted the risk-on mood on financial markets, sending global benchmarks higher and driving the greenback lower. The market reaction was sharp everywhere around the globe as the statement was even more dovish than expected, traders are now pricing a rate cut for the next July meeting. The Stoxx-600 extended this week’s rally, led by Miners and Energy shares. The best European performance is being brought by the FTSE-MIB index in Milan where prices are trading towards a 6-weeks high.

Pierre Veyret– Technical analyst, ActivTrades


This is a particularly important day for gold. Bullion is rallying after the FOMC meeting and the dovish view presented by its board. This jump is very significative because besides reaching a 5-year peak, prices have broken out the resistances placed at $1,350/1,370, which have stopped price rallies in several occasions in the past few years. We are assisting to the opening of many long positions as well as the closure of many shorts, in a scenario that has turned more bullish for the precious metal.

Carlo Alberto De Casa – Chief Analyst, ActivTrades

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