Beware of New Gold Forecasts by 19 Wall Street Analysts! – Cryptokoin.com

Gold prices closed the second week below $1,900. Therefore, the mood in the gold market quickly deteriorated. But while prices are expected to drop, many still see a potential drop as a buying opportunity.

“Gold price action is like a ‘coin flip’”

The latest Kitco Weekly Gold Poll shows Wall Street Analysts are bearish on gold in the short term, with the bullish trend among retail investors falling to their lowest point since late October. Ole Hansen, head of commodity strategy at Saxo Bank, comments:

Overall, the market’s limited ability to respond to last Friday’s drop below $1,900 continues to weigh on the market. I’m neutral on gold and the price action is like a ‘coin flip’.

“Gold has solid downward momentum, but…”

Darn Newsom, senior technical analyst at Barchart.com, says gold could see some interesting price action next week. He states that the precious metal has solid downward momentum but is oversold in the short term. He adds that the short-term technical outlook points to a test of the $1,823 support. In this context, the analyst makes the following statement:

It’s a long way off, and as I said, the contract is already short-term oversold. To achieve this, gold will need to see the US dollar index extend its short-term uptrend next week. This is also made more difficult by the short-term overbought of the dollar.

Gold poll results: Bears are getting stronger

This week, 19 Wall Street analysts took part in the Kitco Gold Survey. Nine analysts /47% among respondents) are bearish on gold in the near term. At the same time, only two analysts (11%) were expecting a rise for the next week. Eight analysts (42%) predict that prices will remain flat.

Meanwhile, 733 votes were cast in the online polls. Of these, 324 (44%) expected gold to rise next week. 135 voters (18%) remained neutral in the near term, while the other 274, or 37%, said it would be lower. The increase in the bear sentiment came as gold prices ended the second week with losses.

“This is a big risk for yellow metal”

According to some analysts, selling pressure continues as US Federal Reserve members reiterate their hawkish stance on interest rates. Some say they expect the Fed Funds rate to rise above 5% before reining in inflation. cryptocoin.comAs you follow on Tuesday, in a meeting with David Rubenstein at the Economic Club of Washington, Federal Reserve Chairman Jerome Powell said that monetary policy should remain restrictive “for a while” even though he sees signs of falling inflation.

Gold

With these comments, some analysts say that inflation could move downward on gold prices and must be significantly weaker than expected to reverse the current correction. Adam Button, chief currency strategist at Forexlive.com, comments:

A hot CPI data next week is a big risk for gold. A cold data would be positive, but not nearly to the same degree. Presumably, gold will continue its downtrend next week.

“A little more consolidation may be needed before going up”

However, not all analysts see gold prices falling next week as negative for the market as it provides a new entry point as the uptrend continues. Michele Schneider, head of trading education and research at MarketGauge, says he sees a buying opportunity if gold holds support above $1,850. She adds that in a world full of uncertainty, the safe-haven appeal of gold will continue to attract long-term investors.

Adrian Day, head of Asset Management, says he remains neutral on gold as there are still some headwinds. In this context, Day shares the following comment:

The Fed may try again to curb the excesses in the market and the dollar may continue its countertrend rally. But the underlying environment is positive and that will be positive for gold as the US economy weakens. We may need to consolidate a little more before we go up.

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