Jump to content

Market update: gold price forecast-bulls seize control on growing safe haven appeal, $2050 up next


MongiIG

Recommended Posts

Gold rallies but stalls below $2,050/Oz; safe-haven interest could rise with ongoing Red Sea tensions. U.S. data, especially PCE, will impact the dollar and shape gold's week.

 

original-size.webpSource: Bloomberg

 

IG Analyst | Publication date: 

Gold prices found its legs in the US session rising back above resistance at the $2040/oz level. A slightly stronger US dollar kept gold bulls at bay in the European session, but ongoing comments from Fed policymakers around rate cuts continue to weigh on the Greenback.

Safe haven appeal and us dollar weakness

Geopolitical tensions have become a key driver this week following developments in the Middle East. The Red Sea has become breeding ground of uncertainty, and this seems as if it is only going to intensify. This leaves gold in the driver’s seat with more gains in store if no solution is found to the ongoing strife and tension in the Middle East.

The renewed US dollar weakness has also assisted gold hold the high ground and continue its advance. Federal Reserve policymakers have this week struck a dovish tone with most speaking about the amount of rate cuts needed in 2024; with very little push back besides the odd comment about monitoring data moving forward. The only push back in terms of comments came from policymaker Barkin saying that he thinks inflation is more stubborn than the average Fed official.

US treasury yields also continued their struggles today with both the 2Y and 10Y yield also benefitting gold.

US2Y and 10Y daily chart

 

Source: TradingView

US data ahead

US data lies ahead with a key print being the US PCE data, which is due on Friday. This may have a significant impact on US rate expectations before the year is out, while we also have the final Q3 GDP number.

There is other "high impact" US data due with CB consumer confidence and the final Michigan Consumer Sentiment number, which should not have a material impact but rather short-term moves that could be erased toward the end of the trading session.

Economic calendar

 

original-size.webp

 

original-size.webpSource: DailyFX

Gold technical analysis

Form a technical perspective, gold is interesting following the recent selloff which stopped last week as gold printed an indecisive candle close. This should have given us a sign that we may get further upside this week which has come to fruition but further upside in my opinion appears limited.

As things stand, a daily candle close above the $2040 mark this could facilitate a run toward resistance at the $2050 mark and beyond with the fundamental picture supporting this narrative. However, I have a feeling that a retracement may come into play soon with a host of resistance area between the $2050 and $2078 handles which may prove to be a hurdle to far.

Key levels to keep an eye on:

Resistance levels:

  • 2047.00
  • 2058.00
  • 2078.00

Support levels:

  • 2030.00
  • 2012.00
  • 2000.00

Gold daily chart

 

original-size.webpSource: TradingView

 

 

 

 

This information has been prepared by DailyFX, the partner site of IG offering leading forex news and analysis. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

  • Like 1
Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • I'm intrigued by NADA Protocol's vision of integrating blockchain technology into the gaming experience. The prospect of owning and trading in-game items through NFTs adds an exciting dimension to gameplay, offering real rewards and enhancing immersion. The marketplace controlled by the NADA token seems promising, providing a platform for users to engage in trading activities within the gaming ecosystem. I'm optimistic about NADA's potential to carve a niche for itself in the competitive gaming world, especially with its focus on creating a fun and economically rewarding gaming environment. Looking forward to exploring this new gaming frontier!
    • I see DIMO's innovative platform as a game-changer in the automotive industry, offering a new level of connectivity and transparency. With DIMO, I can envision having access to valuable vehicle data that can enhance my driving experience and provide me with insights into the car's condition. This not only makes the car-buying process easier but also instills confidence in the vehicle's history and performance. Moreover, the listing of DIMO's native token on Bitget exchange is exciting news as it will create more exposure for the project, potentially leading to further advancements and adoption in the automotive space.    
    • The growth trajectory and innovative approach of Autonolas are indeed impressive, signaling its potential to disrupt both the crypto and AI sectors. With its unique blend of off-chain services and AI capabilities, Autonolas has positioned itself as a key player in the evolving landscape. Furthermore, the listing of its utility token OLAS on Bitget exchange, coupled with a favorable price trend and deposit rebate, adds to the project's appeal and growth prospects. Exciting times ahead for Autonolas and its investors.
×
×
  • Create New...
us