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Gold Traders Must Embrace for Volatile Price action

Safe heaven liquidity should continue to drive the gold price action for the coming days. US Election related events will have a tremendous impact on commodity markets since they quoted in dollar value on global scale. Volatility might continue to drive the price action as fundamental focus shifts from FED to upcoming US elections. Gold is now trading around 1325.00, as per the data of International exchange. Traders should look forward to subjectivity and volatile fluctuations.

Gold, US Election and Price Action Trading

Gold Price action trading as per the rhythm of US Election related events

Following the recent debate between two opposing candidates, safe heaven instruments came under selling pressure. The pattern suggests that investors view Hilary Clinton winning the election as a risk on development where Trump favors a risk off environment. Market participants will continue to gauge the prospect of elections and might adjust their portfolios accordingly. Such a behavior results in volatile fluctuations and event spike price patterns.

Gold was in minor downtrend before the debate; later price action broke out of the trend line around 1316.00. Buying pressure increased after the rejection pattern, showing the conviction of buyers to absorb the selloff. As per prior price action Market anticipated Trump to win the debate, when Hillary took the lead it caused some correction. When market structure failed to sustain above 1340.00, prices dipped sharply because of position adjustments by smart money players.

US Presidential choice related news announcements and events are the major culprit behind the price movements. Fundamental focus shifted from FED hike to US elections on the perspective of Market participants. From now on US Election related factors will drive gold prices, Traders must observe the price action and should look for potential risk –reward based trading opportunities on both sides.

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