- Gold prices have found room in the 1500s and are staying out, despite a correction in stocks.
- Gold spot reached a high of $1510.45 from a low of $1472.34.
Gold prices have been capped at fresh highs through the $1500 psychological level as investors bank, once again, on the idea that the Federal Reserve will cut interest rates again as soon as next month, sparling some relief in US stocks with benchmarks paring back most of the session’s losses.
Gold spot reached a high of $1510.45 from a low of $1472.38 and is currently trading 1.96% higher on the day. The dollar has been trading between 97.31 and 97.85 while the 10-year yields are -1.72% still, but way off from their lows of 1.5930% at 1.6720% currently.
“President Trump is ratcheting up the pressure on the Fed to support his efforts on extracting concessions from China on trade. Policymakers appear reluctant, but market moves and other central bank actions look set to give them a nudge. This is why we think it looks increasingly likely that the Fed will step in with two 25bp cuts in September and December,”
analysts at ING Bank wrote.
How high can you go?
The question on everyone’s mind now is how high can gold really go in such a short period of time, especially considering the amount of speculation that is priced into the precious metal encouraged on words of a US president who seems to change his mind at the drop of a hat?
Gold levels
The bulls have eyes on the 127.2% Fibo target up at 1,560 and then the Oct 2012 highs at 1795 come into the picture on the wide. The 1800s come as the 2011 highs and the price has touched the 61.8% Fibo retracement of those highs to the late 2015 swing lows. The 1528/30s are a prior support which could come in as the next major upside target where the price would be expected to hold initial tests. The 1430s come as a likely support area below a retracement of the 23.6% Fibo in the 1450s.
Share
