Gold is balancing record highs with signs of potential correction. Rising Treasury bonds and a strong dollar affect the course of gold. The precious metal remains a solid hedge against inflation and uncertainty. As prices approach $2,300, demand from emerging market central banks is changing the dynamics of the gold market, according to BCA Research
Gold price will continue its upward trend!
cryptokoin.comAs you follow from , gold has entered an upward trend since November 2022. According to Robert Ryan, Chief Commodity and Energy Strategist at Montreal-based research firm BCA Research, the upward trend in gold prices will continue. Ryan says expected changes in the Federal Reserve’s monetary policy are the reason for this rise. It also states that interest rates will remain low as long as inflationary pressures and increases in investment and R&D expenditures increase labor productivity.
Robert Ryan says this will allow the Fed to enter a downward cycle in policy rates. He also states that it will allow gold prices to rise. Meanwhile, BCA predicts a rate cut in June. However, doubts about this issue began to emerge in the markets. In any case, a delay in the Fed’s easing cycle will only delay the gold rally, according to Ryan. However, the strategist predicts that the uptrend will continue.
Rising treasury yields and a strong dollar
Treasury yields remain in focus as investors await more U.S. economic data. The 10-year Treasury note yield, which recently surpassed 4.4%, reflects investors’ interest in economic indicators and Federal Reserve policies. The strength of the dollar, which has reached its highest level in four months, puts pressure on the gold market. Thus, complicating the landscape for bullion investors.
Expectations regarding interest rate cuts by the US Federal Reserve are met with a cautious but optimistic tone by the authorities. Policymakers at the Fed acknowledge the possibility of a rate cut. However, it underscores the solidity of recent economic performance. This careful balance, reflecting steady growth in manufacturing and a strong labor market, points to a thoughtful and measured approach to monetary policy.
Gold price tit-for-tat term outlook
Market analyst James Hyerczyk looks at the technical picture for gold. Considering the above factors, the gold market is in a tug of war between safe-haven buying and bearish pressures from a strengthening dollar and rising yields. The technical structure indicates a possible downtrend. However, gold’s primary role as a hedge may continue its upward trend. The near-term gold market trend will likely be influenced by upcoming economic data releases. Additionally, Fed policy signals and ongoing global tensions will also have an impact on the market. Investors need to watch these factors closely to get an idea about gold’s short-term direction.
Gold prices reached a record high earlier in the day. However, it later went into decline. Given the prolonged upward move in price and time, a higher high, a lower close, will potentially create a bearish closing price reversal top. Confirmation of the chart pattern on Thursday will indicate momentum shifting downwards. This could trigger the beginning of the 50% to 61.8% correction of the rally from the $2,146.155 low to $2,288.435. This makes $2,217.29 to $2,200.51 the first target. On the upside, an intraday rise above $2,288.435 would signal a resumption of the bull trend.
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