Although gold prices continue to remain above 2 thousand dollars, they are having difficulty advancing. The yellow metal, exposed to adverse winds, still resists. In this environment, TDS economists predict higher prices in the coming quarter.
TDS: Gold price will be $2,200 next quarter!
US monetary policy has become increasingly restrictive since the beginning of 2022. Despite this, gold has had a surprisingly strong performance. It has hovered above $2,000 for the better part of the last twelve months. Economists at TD Securities expect gold to average $2,200 next quarter. In this context, economists make the following assessment:
The Fed’s dovish tone and another year of record official sector purchases will fuel the gold bull run later in the year. The fact that the Fed will cut interest rates in the coming months will encourage investors to increase their long positions. Additionally, prices are expected to rise to an average of $2,200 in the next quarter, driven by strong physical demand and official sector purchases. We expect gold to average $2,081 throughout 2024.
Indicators to follow for the direction of gold
Geopolitical tensions and demand for safe haven
Israel’s rejection of Hamas’s ceasefire offer underlined ongoing geopolitical tensions. This caused gold to maintain its appeal as a safe haven. This demand is met by uncertainties regarding the Fed’s interest rate decisions.
The Federal Reserve’s stance on interest rates
Fed officials are currently reluctant to cut rates until more concrete evidence emerges that inflation is moving toward their 2% target. The opportunity cost of holding non-interest bearing gold increases with higher interest rates. This limits its upside potential. Recent strong US economic data and Fed Chairman Jerome Powell’s hawkish statements have reduced the possibility of a rate cut in the near future.
Treasury yields and US Dollar
The market closely follows US Treasury yields, which affects gold’s appeal. As of the latest data, yields are around 4.11%. This reflects investors’ caution and expectations about the Fed’s future moves. The US dollar, which has recently rallied, is currently trading in a limited range as the market processes less dovish comments from Fed officials and awaits new US economic data.
Banking industry concerns
Moody’s downgraded New York Community Bancorp to junk status, citing pressures on funding and liquidity. This highlights growing concerns in both the US regional and global banking sectors. This uncertainty in the financial sector provides some support to gold prices.
Economic data monitoring
cryptokoin.comAs you follow from , investors are keeping a close eye on upcoming weekly unemployment claims. Additionally, important U.S. economic data, including the inflation report, is on investors’ radar. This data will provide more information about the strength of the economy and potential shifts in the Fed’s rate-cutting schedule.
Gold market outlook and technical analysis
Market analyst James Hyerczyk evaluates the market outlook and technical picture of gold. In the short term, the gold market is oscillating between competing influences such as geopolitical safe-haven demand and expectations for U.S. interest rates. Given the Fed’s hesitancy to cut interest rates and the strength of the US economy, current market sentiment is towards caution with a slight bearish bias. However, any escalation in geopolitical issues or unexpected economic downturns, especially an escalating international banking crisis, could quickly tip gold’s appeal as a safe haven.
Gold is trading at its 50-day moving average of $2,034.09. This indicates uncertainty about the direction of the intermediate trend. However, it is trading well above the 200-day moving average at $1,966.03. This indicates a clearly defined long-term uptrend. On Thursday, we will pivot and look at the 50-day MA for direction. Based on the price action of the last two weeks, this MA is clearly controlling the gold trend.
To be informed about the latest developments, follow us twitter‘in, Facebookin and InstagramFollow on and Telegram And YouTube Join our channel!