“New Peaks?” 6 Analysts Gave Their Gold Price Expectations!

Gold futures ended slightly lower on Thursday, a day after recording the best one-day advance since December and the highest close in two months. At the time of writing on Friday, the gold price was trading at $1,842, up 0.17%. The forecasts of analysts who interpret the next movement of gold cryptocoin.com compiled for our readers.

Can gold price hold and start new highs?

“Gold is finally finding its place, largely due to the inflationary environment we are in and the recent weakness in the US dollar,” said Adam Koos, Chairman of Libertas Wealth Management Group:

While rising Treasury rates will certainly continue to put a ceiling on the price of gold, this does not change the fact that there is a clear and significant increase in relative strength not seen since the price increase in late spring 2021.

Can gold now “hold and initiate new highs?” Adam Koos says. He states that the question gains importance and states that he thinks there may be new heights, especially since the USA has not figured out how to overcome the supply chain shortage created by the Covid-19 pandemic.

Senior Analyst Jim Wyckoff draws attention to inflation fears and interprets the effect on precious metal prices as follows:

Inflation fears are mounting, forcing traders and investors to react to it. One of these responses is to buy fixed assets, including gold and silver, as hedging against inflation.

“The gold price increase was the cries of a market that wanted to go higher”

The latest move in gold came amid some weakness in the dollar and the slump in Treasury yields. On Thursday, the dollar’s boom and the recovery in equities likely contributed to the modest drop in safe-haven gold, analysts said. Senior Investment Analyst at Breokerge XM comments Marios Hadjikyriacos in a daily note:

Bullion exploded above the $1,830 region yesterday, hitting a two-month high and benefiting from the slightest declines in real interest rates and the dollar. Gold took almost no damage as rates rose this week, but traded like a rocket when they pulled back. That’s why we heard the cries of a market that wanted to go higher.

Marketwatch strategists expect the Federal Open Market Committee (FOMC), which will meet Jan. 25-26, could eventually have a heavy impact on the long-term outlook for bullion and lay the groundwork for a series of rate hikes.

U.S. unemployment benefits applications rose 55,000 to 286,000 last week, hitting a three-month high. Separately, the Philadelphia Federal Reserve’s production conditions index rose 8 points to 23.2 in January, indicating that businesses are still growing despite the Omicron outbreak. Jim Wyckoff notes that Thursday’s US economic reports did not have a major impact on precious metals.

Ricardo Evangelista: Increasing geopolitical instability supports gold

Daniel Pavilonis, senior market strategist at RJO Futures, says the primary factor driving gold is inflation, which has increased its appeal as a hedge against rising prices:

The market seems to want to continue to rise. This points to a self-fulfilling cycle where more data is emerging and inflation is not temporary.

Meanwhile, holdings of SPDR Gold Trust, the largest gold-backed exchange-traded fund, jumped to its highest level since mid-December, reflecting investor appetite. Ricardo Evangelista, senior analyst at ActivTrades, notes that growing geopolitical instability is underpinning especially Russia-Ukraine tensions. Russia has deployed troops on Ukraine’s borders, and Western states fear that Moscow is planning a new attack.

However, rising interest rates remained a potential headwind as holding the non-yielding bullion translated into a higher opportunity cost. According to a Reuters poll, the US Federal Reserve may tighten monetary policy faster than expected when it meets next week.

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