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Gold price at risk of pullback to $4,215/oz as short-term momentum fades - World Gold Council
KITCO • • business
Key Points:
- The Treasury Department and Federal Reserve are sending mixed signals, but overall recent developments have negatively impacted gold prices, causing them to retreat as global bond yields rise, according to the World Gold Council (WGC).
- Fed Chair Warsh's hawkish remarks and strong U.S. inflation data have increased expectations of near-term rate hikes, raising gold's opportunity cost and reducing its attractiveness.
- Despite ongoing global gold ETF inflows and rising futures net longs, technical indicators suggest gold may pull back to its 55-day moving average due to weakening short-term momentum and rising bond yields.
- Key support levels for gold are identified at $4,311/oz (mid-August low) and the 55-day average around $4,215/oz, while resistance is seen at the 13-day exponential average ($4,474/oz) and the 200-day average ($4,530/oz).
- A move above the 200-day average could signal a near-term trend reversal to the upside, targeting resistance near recent highs of $4,696/oz and $4,769-$4,774/oz.
