18 July 2018 ( Lagos ) : It is shaping up to be another brutal trading week for Gold with the metal plummeting to its lowest level this year against an appreciating Dollar.

The sharp depreciation witnessed on Tuesday continues to highlight how Gold remains extremely sensitive to its negative correlation against the Dollar. With Federal Reserve Chairman Jerome Powell reinforcing market expectations of two rate hikes this year, zero-yielding Gold remains a rewarding target for bearish investors. Gold is likely to be treated without mercy by a broadly stronger Dollar this week and this could translate to further downside.

Focusing purely on the technical picture, Gold is undeniably bearish on the daily charts. Daily bears won the battle after prices secured a solid daily close below $1236. With the yellow metal already extending losses today, the downside momentum could open a path towards $1200.

Source: Lukman Otunuga, Research Analyst at FXTM

Reporting for EasyKobo on Wednesday, 18 July 2018 in Lagos, Nigeria