The price of gold, which has been falling since the beginning of the week, has left investors wondering about the next move of the precious metal. In this article, we will convey the gold forecasts of 3 different analysts. Here are the details…
Credit Suisse: Gold could test $1,616
Gold is under renewed short-term pressure. However, it still remains in a wide range. Strategists at Credit Suisse expect the precious metal to test support at $1,616. Analysts of the financial company most recently used the following statements:
We expect the entire 2018/2020 uptrend to be tested around $1,724. Below, to keep the market in a range; The door will be opened for a test of the stated weekly lows of $1,684/76 before the pullback to $1,616 where we await the re-establishment of a new bottom. If it still can’t hold on here, gold will complete a great peak. The intersection of the key 55 and 200-day averages at $1,847 would stabilize the market again in a more meaningful way.
DBS Bank strategist: Liquidation risk continues under
The month of June did not go well for gold, with a 4 percent top-to-bottom drop. cryptocoin.com As we reported, further declines resulted in a sharp 7.7 percent loss against June’s peak of $1,878. As DBS Bank Strategist Benjamin Wong points out, if the ascending trend support line at $1,160 (August 2018 lows) is broken, there remains a risk of further liquidation of long-terms. The analyst uses the following statements:
On the weekly chart of Ichimoku, a bearish path is clear as resistance is forming steadily towards the $1,880 and $1,915 levels. The intermediate resistance measure was also lowered to $1,809 via the Tenkan resistance. The danger is currently at the break of the uptrend support line at $1,160. This marks the lowest level of August 2018, which will create the risk of further capitulation. It also opens the lower price band at $1,626 as a possibility. For this, the 200-week moving average at $1,650 needs to be broken. If we get an emerging triangle, the drop would be a ‘controlled bearish’ between $1,691-$1,677.
Finally, the analyst points to a break of the ascending trend support line at $1160 (August 2018 low). He states that if such a thing happens, those in long positions are at greater risk of liquidation.
What do open positions in Gold show?
Open interest in gold futures markets rose for the second consecutive session on Wednesday. This time, there are more than 5,000 contracts, according to preliminary data from the CME Group. Instead, volume reversed four consecutive days of gains. It shrank by about 34.7 thousand. Gold prices fell to levels last seen in September 2021, around $1,730 an ounce on Wednesday.
The sharp pullback took place amid rising open interest. According to FXStreet analyst Pablo Piovano, this leaves the door open for an extra drop in the very near term. However, the significant drop in volume coupled with oversold levels could encourage a technical recovery. The next level to watch on the downside is the September 2021 low at $1,721.
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