![]() Razaqzada said that the fact that spot gold has not returned to Friday’s closing prices “must be making it uncomfortable to trade gold, as usually gaps tend to fill in highly liquid assets.” But he cautioned that this is not always the case. “So, be on the lookout for more bullish signals to emerge from here on.” “uch of the Fed’s hawkish repricing of interest rates are now done, meaning that the downside for bonds and, by extension, gold should be limited moving forward,” Razaqzada said. He remains steadfastly bullish about gold’s long-term outlook, however. “Therefore, one should not get too carried away by the recent bullish price action.” “So, some of the bullish price action since Friday could be just that – a short-covering bounce,” he said. 21 high means prices were due to see a short covering rally. Razaqzada said gold’s nearly 7% drop from its Sept. “If we see a similar response to this week’s upcoming data (FOMC minutes, CPI and UoM consumer Sentiment survey, among other things), then this will further fuel speculation that the worst is over gold.” “The stronger-than-expected US jobs report on Friday failed to deliver any more dollar strength and with the greenback falling further so far this week, the possibility that the dollar may have formed a top is undoubtedly something that many investors are wondering about,” he added. He said it’s possible that bond yields have peaked. ![]() Gold typically rises when there is heightened geopolitical risks.” “This is why oil prices have remained elevated. “While gold may not be shining so brightly so far today, it could easily find renewed strength as the situation in the Middle East remains intense,” he said, underlining the potential for the conflict to widen. Razaqzada said that even though geopolitical risks such as the ongoing Israel-Hamas conflict haven’t subsided, gold prices have moderated today, due in part to the rebound in bond yields. “More gains could be on the way for gold for as long as geopolitical risks remain elevated and if the upcoming US macro pointers trigger fresh selling in the dollar, after the greenback ended a run of 11 consecutive weekly gains last week.” “In other words, gold is still comfortably higher than Friday’s close,” he observed. Today’s uptick in risk appetite is creating some drag on gold prices, but the precious metal’s weekend gap remains open, says Fawad Razaqzada, Market Analyst at City Index. ![]() Receive a comprehensive recap of the day's top stories directly to your inbox. Get all the essential market news and expert opinions in one place with our daily newsletter.
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