TD Securities Economists Share Their New Gold Price Forecasts!

The gold price consolidated early Asian losses on Thursday, pushing bids higher to $1,785. While the shiny metal initially fell after higher US Treasury yields, the recent recovery has not shown any significant positivity, so it looks immobile as we wait for new evidence to entice the bears, according to market analyst Ross J Burland.

Gold price remains sluggish ahead of expected data

cryptocoin.com As we reported, U.S. 10-year Treasury yields rose for the fourth consecutive day to 1.52%, as S&P 500 Futures reported new Covid-19 fears from the West suggesting South African variant Omicron is milder than previous variants. It is posting slight losses, challenging its previous optimism. There are also rumors of US-China and Fed rate hikes weighing on market sentiment and testing gold bulls as the basis for US bond coupons.

However, gold prices remain stagnant as traders await Friday’s US Consumer Price Index (CPI) data to confirm the latest jump in Fed rate hike expectations. During the Federal Reserve’s blackout, the gold price changed little on Wednesday, with DXY offsetting strong US Treasury yields ahead of this week’s US CPI data. According to the analyst, investors are probably holding their positions until key data.

“Risk balance for gold positions continues to be up”

TD Securities analysts expect inflation to slow significantly as fiscal stimulus eases and supply constraints are eased, but they don’t expect the data to be confirmed in the near term:

CPI likely rose in November. The drop in oil is too late to prevent another major rise in gasoline and core prices, supported by skyrocketing used-car prices and stronger post-Delta airfare and accommodation prices.

The data will be important to traders as a follow-up to an acceleration in tapering speed by the Federal Reserve, which will potentially begin later this month. If US November inflation data comes in higher than expected on Friday, the hawks may seek a rate hike in March. Hints of the possibility of a March hike will become clear next week (December 15), when the Fed is expected to announce an accelerated reduction in bond purchases.

Meanwhile, according to Ross J Burland, benchmark U.S. Treasury yields have soared and eroded gold’s appeal as the narrative reverts to central banks’ tightening policy that would boost the U.S. dollar. While TD Securities analysts expect inflation pressures to remain high in the first months of the year, the market’s pricing for Fed hikes may become more aggressive, but this will eventually prove too hawkish. Analysts make the following assessment:

In fact, with both an accelerated tapering and more than three rate hikes priced for 2022, the balance of risk for gold positions remains upside as geopolitical risks and virus risk could accelerate position change.

Gold price technical analysis: space is running out for bulls

According to market analyst Ross J Burland, gold price is stuck in familiar territory and the monthly chart shows that space for bulls is running out. The analyst states that a break of the symmetrical triangle could open the way for a potentially significant downside break if $1,700 is reached.

From a daily perspective, the price must first break the $1,810 resistance before it can reach the $1,850 area.

Contact us to be instantly informed about the last minute developments. twitter‘in, Facebookin and InstagramFollow and Telegram and YouTube join our channel!