Trading Gold (XAUUSD) Short. “Buying the Dip” on S&P 500.

Welcome to this week’s Market Blast Fundamentals.

I’m Brad Alexander and on behalf of Valutrades today we will take a look at the S&P 500, USDJPY, Gold (XAUUSD) and EURUSD.

Last week’s FOMC meetings were a surprise to the markets with the US Federal Reserve not wanting to tolerate inflation, finally talking about tapering bond purchasing and looking at perhaps 2 interest rate rises in 2023, earlier than expected.

This sent the USD stronger against most currencies except the Yen.

Jerome Powell will be speaking to the US Congress about all this and the Coronavirus Stimulus plans so watch for volatility.

Also, many FOMC members will be speaking all week so we may get more clarity on the plans and perhaps further USD momentum.

The stronger USD and the Bond sell-off has caused the price of Gold to fall dramatically and it is currently at a key level around $1776.

Further news from the Fed about bonds and interest rates this week could see XAUUSD falling further.

Also, whenever an economy talks about Interest rate rises, equities tend to fall as they will see borrowing costs going higher.

The S&P 500 index did just that and we might have an opportunity to “Buy the Dip” and we will look at that again tomorrow.

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That’s all for now.  Happy trading with Valutrades and we will see you tomorrow.

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