Gold has steadily risen this week, and with the release of economic data, prices have fluctuated. However, after the strong and sudden fluctuations of the past month or so, the price trend of precious metals has become more orderly and less intense.
The latest Kitco News weekly gold survey shows that retail investors remain overwhelmingly bullish next week, while the same proportion of market analysts have shifted to a neutral assessment of gold's near future prospects.
Adrian Day, President of Asset Management Company, predicts that gold prices will not change much in the coming week. After the recent rise, gold is easily affected by bad news, "he said. The medium-term fundamentals are very strong: at some point, the Federal Reserve and other central banks will loosen their tightening policies before inflation is conquered, which will become a shot at gold. But that's not the time yet
Daniel Pavillonis, a senior commodity broker at RJO Futures, believes that gold will enter a long-term consolidation period as political risk buying has subsided. We are at the upper limit of this trading range, and we have been in this trading range for several weeks now, "Pavillonis said." We are likely not to see any further rate hikes. We may see some rate cuts in May next year, but I doubt if this will happen. I think we will really stay in place for a while
Pavillonis stated that although gold prices continue to react to economic indicators, they do not provide clear direction for precious metals. I think the market is just weighing various inflation data, "he said, Housing is starting, they are still building houses, and there is still demand. The employment report still looks relatively strong. From the Consumer Price Index (CPI) data, the biggest decline is in healthcare. I would like to say that we will still be subject to range restrictions next week. I don't see anything that can make this move in the right direction. I think it will remain at our previous level, trading within the range of $40, $50, and $60 per ounce
He said, "If inflation data continues to weaken and we don't lower interest rates, it will be difficult for gold prices to rise." "Without geopolitical factors, I don't know what the driving factors would be
This week, 12 Wall Street analysts participated in the Kitco News gold survey. Just like last week, three experts (25%) predict that gold prices will rise next week, but only one expert (8%) predicts that gold prices will fall this week. The vast majority (67%) hold a neutral attitude towards gold in the coming week.
Meanwhile, Kitco's online poll generated a total of 595 votes, and market participants' attitudes were more optimistic than last week's survey. 394 retail investors (66%) expect gold prices to rise next week. An additional 125 respondents (21%) expect prices to be lower, while 76 respondents (13%) are neutral about the near future prospects of precious metals.
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(Image source: Kitco)
Next week will be a brief trading and economic data release week, as Thursday is the Thanksgiving holiday in the United States, which means most activities will be compressed into the first three days. Highlights include the release of the latest minutes of the Federal Open Market Committee meeting on Tuesday and existing home sales data for October, followed by the release of durable goods data for October, consumer confidence data for November from the University of Michigan, and weekly unemployment claims on Wednesday.
Everett Millman, Chief Market Analyst at Gainesville Coins, said he believes gold investors are shifting their attention from the political realm to the macroeconomic realm.
He said, "I think we are seeing the focus of the gold market shift away from the war premium we see, which has undoubtedly driven gold prices higher in recent weeks."
Millman stated that the current consensus is that the Federal Reserve is likely to have completed rate hikes, while the gold market will truly focus on the speed of rate cuts. He said, "Apart from a severe recession, lower interest rates are basically the biggest bullish driver for gold." "I think the economic data is a bit mixed. I see a lot of talk about how strong the economy is in reality, yes, some data shows this. But on the other hand, you can also see just as many examples or indicators I think this means that gold will experience a period of lateral fluctuations or consolidation until we have a clearer understanding of the economic situation
Millman also stated that under the leadership of the Federal Reserve Chairman, gold traders cannot wait for interest rate cuts to enter their positions, which is different from the past Federal Reserve. This is very different from the Greenspan era, where Greenspan was basically trying to cover up the actions the Federal Reserve was about to take, so that no one could preemptively implement them, "he said, Now the Federal Reserve does indeed directly telegraph these things, and Powell has repeatedly acknowledged that there is a lag in the implementation of these policy actions, which traditionally could be as long as 18 months. Therefore, I believe that the market will no longer focus on signals rather than actions, which is actually reasonable because we do know these changes in interest rates, or the measures taken by such policy decisions from quantitative easing to quantitative easing, which only take 12 to 18 months Being able to fully integrate into the economy and truly influence the market Obviously, if there is such a long lag, market participants must give up the signal and continue working, because if you wait to react to actual consequences, such as the lag result, then you will be far behind the eighth ball, "Millman said, They know that a change of 500 basis points in interest rates occurs in a very short period of time, but we have not yet waited for a full year and a half. We are already very close. I think this will definitely affect calculus here
Ole Hansen, head of commodity strategy at Shengbao Bank, stated that he does not believe there will be any major moves in gold in the short term. "Last week, I was very 'lucky' to have chosen the timing, and I am currently looking for further consolidation next week, so my rating is neutral
Colin Cieszynski, Chief Market Strategist at SIA Wealth Management, also maintains a neutral attitude towards gold in the coming week. My reason is that between the usual month end economic news downturn and next week's Thanksgiving holiday in the United States, the overall market may become more calm over the next ten days
Barchart.com Senior Market Analyst Darin Newsom is optimistic about the outlook for gold next week. Over the past week, the short-term upward trend of gold in December has been stable, with the contract hitting a high of $1996.40 per ounce earlier on Friday, "he said. If the contract closes lower on Friday, then December gold may also fall on Monday and Tuesday
Using Elliott's wave theory, this will be seen as the second wave of a 5-wave short-term upward trend pattern, "Newsom said." Ultimately, it is expected that the contract will break through the first wave high
Marc Chandler, Managing Director of Bannockburn Global Forex, holds a neutral bias towards the coming week. He said, "On Monday, the spot market gold price hit a bottom near $1931 per ounce, and today it hit nearly $1993.50 per ounce before the weekend." "The main driving factor seems to be the decline in US interest rates and the US dollar. It is not inflation that lowers interest rates and weakens the US dollar, but a decrease in inflation (reports from the US and UK in recent days)
Chandler added, "Next week's economic calendar will be even lighter, and the market expects the Federal Reserve to cut interest rates by 100 basis points next year." "Therefore, I look forward to some consolidation in the entire capital market, which may lead to gold consolidation. I believe the initial support is in the 1970-1975 USD/oz region
Kitco Senior Analyst JiWyckoff expects gold prices to rise next week, "as the charts become more friendly and US monetary policy becomes more friendly after this week's mild inflation report
Spot gold is currently flat on the day, but has risen 2.17% since Monday as market participants prepare for the weekend.
