Gold prices have been
on a steady climb this week, rising by 1.0% to $2,455 per troy ounce. The gradual increase, with prices inching closer to an all-time high,
indicates a persistent attempt to break through resistance levels. However, the
diminishing size of each upward movement suggests that the market might be
reaching a point of exhaustion.
Large investors seem to share this sentiment.
The SPDR Gold Trust (GLD) has reported net inflows for six consecutive weeks,
but the inflow amounts have been decreasing, reflecting a cautious optimism.
Despite the inflows totaling $1.38 billion during this period, gold prices have
only increased by 3.5-4.0%, leading to a modest net profit of around 3.0% after
accounting for fees. This lackluster return might not be enough to satisfy
large investors, indicating potential weakness in the gold market.
Recent economic data has provided mixed
signals for gold. The U.S. labor market report, which was weaker than expected,
did not significantly boost gold prices. Similarly, this week's favorable
inflation data, with both Producer and Consumer Price Indexes declining, failed
to propel gold past the $2,470-$2,500 resistance range. Instead, prices
retreated by 1.5% to $2,438 per ounce, suggesting that the market might be
tiring of the current range-bound trading.
Technically, gold has a window until early
September to make a decisive move above the current resistance. However, if it
fails to break through by the end of August, investor disappointment could lead
to a sharp decline in prices. The Federal Reserve's upcoming FOMC Minutes and
the Jackson Hole Economic Symposium next week will be crucial. If the Fed
signals a dovish shift in monetary policy, it could provide the final push for
gold to break through its "glass ceiling." Failure to capitalize on
this opportunity, however, could result in a significant downward correction.
© 2000-2024. All rights reserved.
This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.