Prices are poised to end the week at their lowest level since April 2020. Meanwhile, the relentless rally of the dollar to 20-year highs is negatively affecting the gold market. The extraordinary strength of the dollar and rising bonds has shifted sentiment among Wall Street analysts to the downside. A survey of 19 Wall Street analysts and retail investors revealed their price expectations.
Most Wall Street analysts expect a drop in the price of gold
A total of 19 market professionals participated in the Wall Street survey. 10 analysts, who make up 53% of the participants, said that there will be a decrease in gold next week. However, 6 professionals representing 32% of analysts announced that they expect an increase in the near term. The remaining 3 analysts (13%) preferred to remain neutral on the gold price. As a result, most Wall Street analysts predicted that the precious metal would fall further next week.
Main Street remains bullish
However, the sentiment was different on Main Street, which is made up of retail investors. In this context, 963 participants voted in online polls. 469 people, 49% of these investors, were expecting an increase in the gold price. Meanwhile, 341 investors, who make up 31% of the participants, predicted a decline like Wall Street. The remaining 153 of the 963 investors preferred to remain neutral for the precious metal.
Meanwhile, the divergence in sentiment among retail investors arose because the bearish trend had a slight advantage. December gold futures were last traded at $1,655, down about 1.7% from last week. cryptocoin.com As we have reported, the FED decided to increase interest rates by 75 basis points on September 21. However, the precious metal still managed to maintain critical support levels.
“Golden week may be at these levels”
On the analysts’ side, the bearish sentiment is more dominant. This is because the US dollar is still very strong. Marc Chandler, chief executive of Bannockburn Global Forex, predicted a short-term bounce as bond yields consolidated. However, he added that he watches the price to see if the $1,650 support can hold. “Breaking this level will bring $1600-1620 into consideration,” the analyst said. He also added that it is “too early to consider a significant drop in gold.”
“Gold will rise if the dollar pulls back next week,” said Darin Newsome, head of Darin Newsom Analysis. However, he also reported that it is too early to predict the rise. According to him, the dollar is currently very strong and gold continues to give bearish signals. Getting out of this will be possible with the mobilization of the market by an external power. Meanwhile, SIA Wealth Management’s chief market strategist, Colin Cieszynski, said the gold is bearish as it has suffered significant technical damage to the precious metal:
“I think the dollar is overbought and it’s because of a correction. But gold didn’t just fall below $1,680. It also fell below its 200-day moving average. All this is technically very important and there is a huge downward trend right now.”
