The fundamental and technical picture for gold does not paint a supportive picture for the yellow metal, says Rob Kurzatkowski, senior commodity analyst at OptionsXpress. Looking at the technical picture, he says gold could eventually test support at $1,175 or $1,150 as prices have broken below their major moving averages. “Given the preceding down move in the market over the past month to month and a half, the bias seems to be to the downside out of this consolidation,” he said. The fundamental picture is just a gloomy as the need for safe-haven demand has decreased as Greece managed to negotiate a four-month funding agreement with its creditors. Also add markets ignoring continued conflicts in Ukraine and President Obama’s pledge to increase military action against Islamic State (ISIS) fighters. “Investors have been saturated with news on both fronts, so traders may be a bit indifferent to fresh news, barring a major escalation. In the near-term, gold may be more sensitive to currency fluctuations and interest rate speculation rather than geopolitical events,” he says.
