After yesterday’s big washout in gold, due to a complete flip in the Retail Sales report from what the market expected and what was actually reported, the path of least resistance now is down. Yesterday’s action was a trend changer. With gold now trading at $1,750 we can now target $1,720 to $1,700 as the next level or range to be tested. Gold traders want a “dovish” Fed. Strong inflation data will force the Fed’s hand to taper sooner rather than later. I wouldn’t be surprised to see gold take a breather after yesterday’s sharp selloff and trade sideways until next week’s FOMC Meeting.
Today there’s red all over the board. Dollar strength coming from prospects of higher rates puts pressure on all commodities. Equities down for the same reason. Treasuries down as yields tic higher. You know how it works. You have to pay attention to outside markets regardless of what market you trade.