Gold prices faced a slight decline today. So, will this trend reverse? Will there be an increase in the upcoming period? Analysts of the famous financial company TD Securities explained. Here are the details…
TD Securities: On the cards, downside for gold
Today international gold price hit a nearly two-week low on Wednesday, but safe-haven bullion demand Prices were confined to a tight range as continued pressure from a stronger dollar boosted US Treasury yields. As we reported on Kriptokoin.com , a stronger dollar makes bullion more expensive for buyers holding other currencies, while gains in US 10-year Treasury yields reduce the appeal of zero-yield gold.
The price of spot gold remained at $1,838 as of writing, after hitting $1,832.41 during the day, its lowest level since May 20. Meanwhile, U.S. gold futures fell 0.6 percent to $1,838.20, data show. Gold settled below the 200-day moving average (DMA) of $1,837.60. In the opinion of the strategists at TD Securities, cards have more gold downsides and therefore higher damage rates.
Fed may have no choice but to stick to a hawkish policy stance
With inflation still raging, analysts say, the Fed has no choice but to stick to a hawkish policy stance for a while may not be. Therefore, as real rates rise, interest rates are likely to ease in the long run, which should push gold further. TD Securities analysts also use the following statements:
At the current $1,837.60, prices are at risk of falling below support and could drop below $1,800 an ounce. While this does not provide an increase in the capital value of gold-weighted portfolios, it can be positive for those looking to generate returns by trading precious metal futures. Higher real rates and reduced length of speculation tend to be a positive catalyst for lease rates.
