The gold market is closing its third week in negative territory. Still, bullish sentiment is mounting among Wall Street analysts and retail investors as the Federal Reserve prepares its monetary policy plan over the summer. As Kriptokoin.com, we convey the predictions and market assessments of famous analysts about gold prices
Market overview and analyst views
After the highly anticipated monetary policy decision of the US central bank, investors The short-term outlook for gold has improved sharply. The bullish sentiment among retail investors fell to an eight-month low last week. While a strong U.S. dollar and rising bond yields are creating strong headwinds for gold, many analysts said a shift in the momentum of these markets could be seen. Federal Reserve Chairman Jerome Powell reassured markets that there might be a larger 75 basis point move as the U.S. central bank tries to raise interest rates another 50 basis points in the next two meetings. Philip Streible, chief market strategist at Blue Line Futures, said:
I think we’ve reached the pinnacle of hawkishness with the Federal Reserve. Other central banks will need to step up their tightening measures. The US dollar looks a little high as other central banks, such as the Bank of Japan and the European Central Bank, cannot ignore inflation for much longer.
Adrian Day Head of Asset Management, Adrian Day, added that the increasing volatility in the stock markets also supported the bullish outlook of gold next week and said:
Initially, the stock market It’s not unusual for gold to be used as a source of liquidity when it drops, but after that gold becomes a safe haven and insurance.
Analysts hopeful for gold prices
17 Wall Street analysts surveyed gold this week. 53 percent of participating analysts expect gold prices to rise next week. While 35 percent of analysts think that gold prices will fall in the short term, 12 percent of analysts abstained from prices. Meanwhile, 1,049 votes were cast in an online gold poll. 61% of respondents predict that gold will rise next week. 23% predicts that gold will decline. 16 percent of the participants abstained for gold prices.
Sentiment changed as gold prices last traded at $1,883.40 an ounce, down 1.5 percent from last week. Colin Cieszynski, chief market strategist at SIA Wealth Management, said gold will rise next week as he expects the US dollar to drop from its highest level in 20 years, adding:
The US dollar is oversold against several fiat currencies. This indicates that gold may start a correction that could ease its recent pressure.
Gold investors need to be patient
However, not all analysts are optimistic about gold in the near term. Gold will continue to underperform as the Federal Reserve paves the way for a 50 basis point rate hike, according to State Street’s Milling-Stanley. Stanley says:
Employment is solid and the economy is supported, so there’s no reason the Fed should stop raising interest rates. This will continue to support the US dollar.
Darin Newsom, Head of Darin Newsom Analysis, said he sees gold prices going higher in the near term as it appears technically oversold. However, he added that gold is not a fundamental reason for the current downtrend to end. Sean Lusk, co-director of commercial hedging with Walsh Trading, said he does not think the US dollar will change significantly in the near future, adding:
In foreign exchange markets, this is the only game in town.” “At the end of the day, gold is in a downtrend and I don’t see it ending anytime soon. There is no doubt that gold will make a big splash, but for now, investors need to be patient.
