Sept. 22 (MF Global) - Price Outlook

The gold market should maintain its generally downward direction in the near-term, with prices reaching the $1,700-$1,750 range over the next few weeks. Pressure will be applied by yesterday’s negative reaction to the FOMC results, additional gains in risk appetite, and from recent CFTC data showing selling by large speculators. Bullish arguments will rest on the part of the FOMC statement discussing increased downside risks, the potential that a dollar-funding crisis has been averted, a lack of clarity in the Eurozone, and from Tuesday’s cut to growth estimates by the IMF. We favor maintaining our negative trading affair bias in today’s trade.