简体中文
繁體中文
English
Pусский
日本語
ภาษาไทย
Tiếng Việt
Bahasa Indonesia
Español
हिन्दी
Filippiiniläinen
Français
Deutsch
Português
Türkçe
한국어
العربية
Abstract:Markets now fully price in a rate cut from the Fed as soon as September after US CPI continued to show progress. The dollar-based commodity has a new all-time high in sight
Gold (XAU/USD) Analysis
Gold Prices to Remain Sensitive to Dovish Rate Expectations
Gold has appreciated, buoyed by last weeks lower US CPI data with the path of least resistance to the upside. The precious metal thrives in a low interest rate environment and the mere anticipation of a rate cut from the Fed in September has re-awoken gold bulls.
The precious metal had been hovering around the 161.8% Fibonacci extension of the major 2020 – 2022 decline before the reacceleration to the upside. Gold prices subsided after reaching a new all-time high in May as China, the worlds largest purchaser of the precious metal, dialed back its monthly purchases.
Source: TradingView, prepared by Richard Snow
The gold outlook is likely to will depend on whether a combination of a lower dollar and US yields can reinvigorate bullish demand at already elevated prices. However, at the heart of the recent move is the greater expectation of a Fed rate cut in September. Markets have fully priced in the cut and have opened the door to two rate cuts by year end with a 50% chance of a third.
The weekly chart reveals the difficulty in pushing consistently above the prior high, as gold bulls failed to maintain upward momentum above $2,450 an ounce.
Source: TradingView, prepared by Richard Snow
Gold volatility has subsided now that tensions in eastern Europe and the Middle East have cooled, although, fighting carries on. 30-day implied gold volatility (GVZ) has picked up more recently but it will take a major catalyst from here to entice buyers to return in a meaningful way to sustain prices well above the all-time high.
Source: TradingView, prepared by Richard Snow
--- Written by Richard Snow for DailyFX.com
Disclaimer:
The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.