Kitco News' latest weekly gold price survey shows retail investors remained bullish on the precious metal in the week ending November 3 despite the recent price rally, while market analysts The market is cautiously optimistic.
Gold has held onto recent gains this week, supported by the ongoing conflict in the Middle East, while high bond yields continue to provide headwinds for the precious metal. The precious metal also continued another rally over the weekend, with spot gold once again trading above $2,000 an ounce as traders look to enter long positions in case the geopolitical situation worsens. while the market is closed.
Kitco News' latest weekly gold price survey shows retail investors remained bullish on the precious metal in the week ending November 3 despite the recent price rally, while the majority of analysts Market analysis is also optimistic but a significant minority expect a pullback or consolidation next week.
"I'm going neutral on this week's survey," said Colin Cieszynski, chief market strategist at SIA Wealth Management. "The reason is because I think gold could actually have big moves; I'm just not sure which direction."
Cieszynski said he expected another hawkish decision at the Fed meeting next week. "I don't think they're ready to start saying they're done raising rates," he said. "I think they'll hold on and leave open the possibility of another rate hike in December because they're forecasting another rate hike. I think today's inflation numbers are good enough that they don't need to." have to raise rates again, but at the same time, it's not coming down fast enough for them to say we're done."
He added that staying hawkish could mean a hike in Treasury yields is nearing completion. "That would actually help gold go up, or if nothing else, not go down," he said. "It could probably prevent gold from falling too much. On the other hand, it probably wouldn't be enough to really push up gold prices because Treasury yields are still quite high."
This week, 11 Wall Street analysts participated in the Kitco News Gold Survey. Of these, 6 experts (54%) think gold prices will rise higher next week, 3 other experts (27%) predict prices will decrease and 2 experts (18%) have a neutral view on prices. gold next week.
Meanwhile, 602 votes were cast in online polls. Of these, 395 retail investors (66%) think gold will increase next week. Another 126 (21%) predict lower prices, while the remaining 81 (13%) are neutral next week.
The US Federal Reserve's (FED) interest rate decision on Wednesday will be the main economic event next week, with 94.2% of the market expecting another round of holdings by the central bank . This will also be an important week for the US labor market, with the release of the October nonfarm payrolls report on Friday.
Investors will also pay attention to monetary policy decisions from the Bank of England and the Bank of Japan, along with US consumer confidence and the ISM manufacturing and services PMI.
Sean Lusk, co-head of commercial hedging at Walsh Trading, said he is wondering what will push gold prices out of recent ranges. "I guess we've got bond yields holding it back, we've got geopolitical tensions [supporting gold], and then we've got the Fed in the middle."
Lusk said he believes that at this level, it is the Fed that is actually holding back gold. "We got to $2,009 last Friday, then the market took a risk on the stock for a short period of time," he said. "That pushed gold back to $1,960, but they didn't stay there for long. You're probably running into some psychological resistance at $2,000 an ounce. So far, no convincing." there".
He added that from a crop perspective, early November will typically see a bit of a drop in prices until about mid-December. "But obviously you can throw out crops right away, due to the fact is you have the Middle East about to explode here or the potential exists that it could happen." "That should make people wary."
"But you have to ask yourself, do you want to sell or buy in this market? I think any significant reduction you get will be offset and it will be bought," Lusk said. "Is a ground attack on the horizon? Are other countries jumping into the fray here? We just don't know what will happen overseas. I don't think anyone knows that until that happens."
Lusk said that traders may be concerned about taking sides in the precious metals market at the end of the week as the possibility of escalation remains strong.
"Maybe people will stay neutral; they will evaluate everything and then see what the weekend brings us and what the next holiday is," he said. "There will be the FOMC meeting on Tuesday and Wednesday. It's almost the end of the month, so you could take profits at the end of the month; that could be part of it as well."
Marc Chandler, Managing Director at Bannockburn Global Forex, has a neutral view on gold prices in the near term but expects gold to fall back to support after recent gains.
"Gold is back and approaching the target I suggested last week of near $1,950," he said. "It recovered to set a new weekly high on Thursday near $1,993.50, well above last week's high of $1,997.20. I don't have a firm view on next week. On the one hand, I expect a softer US jobs report and possibly lower US yields and possibly a weaker USD, which would benefit gold. On the other hand, momentum indicators are stretched and Unless the war in the Middle East expands, some late purchases may be cut.
Chandler said that gold's inability to reach new highs in the week's price action also shows the market is stretched. “The $1,950 area could be the first level of support and then closer to the $1,930 level,” he said.
"Decreased, but not significantly," said Adrian Day, President of Adrian Day Asset Management. "Gold is in a holding trend, unlikely to rise much higher at this time but also unlikely to fall sharply. The situation in the Middle East, as well as the chaos in the global bond market, is causing Gold must be bought.
James Stanley, senior market strategist at Forex.com, also predicts gold prices will fall next week. "This week so far has been a doji candlestick pattern on the weekly chart, which shows indecision and the price has held lower highs," he said. "I think this is spot gold stalling below $2,000, and I think that test could even happen next week because sellers aren't really in control here yet. But I also think that there are a lot of long investors who bought in October who may want to take profits at some point. That's one of the downsides to working a breakout as strong as the ones we've seen." .
Kitco senior analyst Jim Wyckoff believes gold prices are likely to continue their upward trajectory next week. "Stable higher as charts remain bullish and safe-haven demand remains clear," Wyckoff said.
Spot gold is now up 1.27% for the week, with almost all of that gain coming on Friday afternoon. The precious metal last traded at $2,006.48 an ounce at press time and remains near session highs after surpassing $2,000 shortly after 2pm EDT.
(Source: Kitco News)