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Gold fell a sixth consecutive session on Friday, closing at $1764.16 to lose 6.0% on the week. The bearish pressure could take a breather this week and give some respite to the yellow metal, strategists at OCBC Bank report.  

Long-term bearish bias still intact

“Bearish pressure may ebb this week – not because we favour the precious metal, but our valuation model suggests gold is currently trading in the middle of its fair-value range after last week’s sharp selloff. Regardless, our bearish call from two weeks ago has played out nicely.”  

“Global assets now look like they are beginning to move in tandem – the decline in Treasury breakeven yields and gold price reinforce the ‘transitory’ inflation idea, while prospects of rate normalisation have dampened riskier assets like equities and commodities.”  

“We see gold likely to trade range bound in the short term but stay bearish longer-term.”