Gold forecast medium term
Gold prices are trading at 1311$ but it seems xau/usd is in no mood to give any easy gains to traders . Its trading in very choppy range since last 2 weeks and still giving false breakouts . Currently charts are in negative but we are taking a contra view . We feel gold price should test 1350$ to 1400$ in upcoming months while downside may be cap till 1275$ or 1250$ .
FOMC meeting
Tomorrow we have FOMC meeting when new chairman powell will announce policy for first time . Fed already cleared that we should expect 3 hikes this year and its very possible we see first 25bps high tomorrow only increasing band from 1.50% to 1.75% . But another event is Friday when another round of shutdown is due . US govt may opt to increase the ceiling of debt but this would be the first time President Trump would have his say on this and he may surprise the market .
Many bond analyst have raised their estimate from 3 to 4 hikes this year and if we face 4 hikes then there would be good selling in equities . Major selling in equity should open door for gold upside as investors find it safe haven .
Technically gold prices have been testing 1307$ – 1303$ range since weeks and buyers are cashing this opportunity to buy major positions on lower levels . So if 1300$ is safe then a good small 8-10$ buy should not be a problem for 1350$ and 1400$ for upcoming weeks . Below 1298$ we should be looking for 1275$ .
We already cleared in our yearly forecast that we expect 1400$ to 1500$ price this year . You may read our yearly forecast here
World Equity market
World equities markets are on lifetime high while not a single country is delivering that kind of growth in GDP numbers . US has delivered 30-40% returns in 2017 so 2018 could be real bumpy and investor may find time to book profits this year and may swipe equity to gold .
Crude oil prices also recovered almost 50% from its last year low of 40$ and trading pretty firm which is not a good signs for most of world economies . Crude oil will play a major role in gold price as its tend to go higher .
In short we expect gold to hit 1400$ to 1500$ this year . We are bullish in medium term trend .
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[…] gold forecast that we expect 1400$ very soon . You may read our detailed medium term gold forecast here . Comex gold trend is positive for upcoming week but some profit booking might lead a small […]
[…] Comex Gold price could not sustain on higher levels, It tested 1355$ and started retracing back. Xau/Usd finally settled below 1340$ signaling further weakness as dollar index closed on highest point of the week. After closing North Korea news came that as they decided to half their nuclear program. This news should give a boost to dollar basket and gold price may open lower. After last week rise in dollar investors finding more value of money in greenback then this yellow metal. For now gold movement should be influence by dollar index as it is the main driver of prices for now. Easing tensions over North Korea and cooling trade war between US and China should give dollar more strength and gold investors may find it attractive to park money in dollar rather in gold. But our medium term view of 1400$ remain intact. Read full post here […]