Forex Videos

A possible rate hike from the US Federal Reserve in December is likely to put investors off from buying gold in coming weeks, and could even spur an investor exodus, says Saxo Bank’s Ole Hansen.
Hansen: We saw demand for coins pick up substantially especially in India. Some of that buying was probably with a view that demand to stay strong ahead of Diwali festival. The monsoon has been the worst in the last 6 years and falling revenues from farmers also means falling demand for gold. It also highlights that when we see weakness, we tend to see tactical investors like hedge funds and starts to scale back. During the time when the physical demand was strong we saw paper demand weakens.
Hansen's outlook for Gold:
1. US rate hike expectations to dampen demand.
2. Investors likely to reduce positions.
3. Physical demand unable to support price.
4. Near term risk is further weakness.
5. Gold may see rally into 2016.
In the near term the weakness ahead of FOMC meeting potentially could see the market stabilizing and rallying into New Year but got a 5 week long wait ahead of us. There has been a lot of selling going on this week in gold. My colleague put out an option strategy and that is the best way to play the upside at the moment. On the downside if we break below 1075 then we will be looking for 1035 level.