Gold Price Forecast: After testing the high of $1,835 in the overnight session, gold prices edge lower on Thursday. The US Treasury yields bounce off their lows following Fed’s official’s hawkish comments.
Gold Price Forecast
US Federal Reserve Vice-chair Richard Clarida signaled that the central bank would be in a position to cut down its massive asset purchase program later this year. In addition to that, three other policymakers also hinted at their approval to start reducing the Fed’s bond-buying program, though their views differed on the timings of the event.
Gold Price Forecast : The US Dollar Index, which tracks the performance of the greenback against the basket of six major currencies, remains strong above 92.20 on Fed’s official comments and upbeat economic data. The ISM Non-Manufacturing Purchase Manager Index (PMI) jumped to 64.1 in July, well above market expectations of 60.5.
Gold prices were unable to find traction after posting substantial gains on Wednesday’s session following the dismal US ADP Employment data, which showed that only 330K jobs were added in July.
Gold Price Forecast
Meanwhile, the precious metal’s downside is capped as demand emerges near the lower level amid rising concerns on the spread of the Delta variant and its possible effect on global growth recovery. Investors remain hesitant to take a big position in the precious metal ahead of Friday as focus shifts to US Non-Farm Payroll data, due on Friday.
Gold prices extended the gains from the low of $1,750.77 made on June 29 and touched the high of $1,832.77 in the month of July. The August series started on a subdued note while swinging back and forth in the narrow trade range of $1,800 and $1,830. The ascending trendline from the low of ascending trendline acts as a defensive for the bulls.
A break of the bullish slop line would intensify the selling pressure in the gold prices. The Moving Average Convergence Divergence (MACD) remains neutral near the midline. A downtick in the MACD indicator would confirm the downside momentum. A sustained break below the $1,800 would make the journey toward the south for the prices.