According to analysts, gold prices may face a real test next week and may hold at $1,700 an ounce. According to analysts, this will be critical for the precious metal, which remains largely above this level throughout 2021. cryptocoin.com We have compiled weekly gold price forecasts for you, let’s examine them together…
Edward Moya: Gold prices in danger of testing the $1,700 level
Despite China’s Evergrande concern worrying the markets, gold prices could not sustainably move above the $1,750 per ounce level. OANDA senior market analyst Edward Moya said that with higher Treasury yields and a stronger US dollar, the precious metal may be in danger of testing the $1,700 level after the Fed’s optimistic statement. Edward Moya makes the following comments on the subject:
The $1,700 level has been held throughout this year, except for a brief moment when it dropped to $1,680 several times but managed to recover quickly. Gold has always been able to find buyers below this level. But will the market see this happen again? Investors are now gearing up for the Fed to start contracting in November and complete it next year.
Edward Moya: These 2 events will determine gold prices next week!
The current trading pattern sees gold first rally in a new risk event, but then give up all gains as tensions ease. Next week, the focus will be on the debt ceiling debate, with US Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell repeatedly stressing the urgency of the issue. Also on the radar will be progress around the infrastructure package.
Edward Moya noted that any hurdles surrounding these two events could help support gold prices next week. “There are some concerns that it won’t be done in time,” said Edward Moya. But at the end of the day, there has to be an agreement on the debt ceiling. If Treasury yields continue to rise, it will be bad for gold.” said.
Edward Moya: Gold could see a more substantial sell below $1,700!
Edward Moya talks about what will happen next week and adds the following to his explanations on the subject:
At the same time, gold prices could see a more substantial sell-off below $1,700 if an easy solution to the debt ceiling is found, shutdown is averted, the infrastructure bill passes, and US stocks return to record high territory. Currently, there is this wait-and-see approach in the gold space, and some investors are watching for the long-term impact of supply bottlenecks. We’ve heard from a few companies like Nike and FedEx. Either supply chain problems or labor shortages. Everything screams inflationary pressures. This could trigger a move higher in yields. Eventually, however, there will be a turning point where gold will begin to act as an inflationary hedge.
Bart Melek: The environment is still good for gold prices and a significant sale is unlikely!
Edward Moya added that gold will remain fragile until it begins to act as a hedge against rising prices. Bart Melek, head of global strategy at TD Securities, said gold risk was on the downside as Powell confirmed the start of contraction in November. Beyond that, Bart Melek said in a recent statement that the environment is still good for gold and a significant sale is unlikely. Bart Melek adds the following to his explanations on the subject:
With the growth rate slowing globally, it will be increasingly difficult for the US economy to publish the growth rates they have. And given the Fed’s full employment policy targets, they’ll be coping with inflation above target. The Fed may need to keep these rates low for a long time. Rates will be quite low. Not bad for gold. Do I see gold rising? No. But I don’t see it getting too low either. I see a recovery once the Taper program starts. $1,700 is the next level of support for gold prices. We can test this anytime, especially if we get strong data reports next week. Resistance stays at $1,800.
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