Yahoo Finance Price of Gold Fundamental Daily Forecast – Gold Up, but Buying Looks Tentative
Gold futures are trading higher on Monday, but the buying has been tentative. The market started the session on the weak side, but turned around when Treasury yields fell and stocks turned lower in reaction to the news that Hong Kong had shut down its airport. Traders are also saying that worries over the slowing global economy are helping to underpin prices.
At 14:00 GMT, December Comex gold is trading $1514.30, up $5.80 or +0.41%.
There weren’t any major developments over the week-end regarding U.S.-China relations and the news from Hong Kong may blow over unless China decides to send troops into the area so today’s intraday rally in gold may not last.
Like I wrote earlier, gold was being pressured from the opening until the Hong Kong news hit, and stocks and Treasury yields fell. The market could turn south again if stocks rebound from the current weakness or if yields start to firm.
Gold is in a long-term bull market due to expectations of lower global interest rates. However, at times, it is also headline driven. Today is one of those days.
Last week’s sideways to lower trade on Thursday and Friday suggest that bullish traders have absorbed the plummeting global yields and the drop in the yuan to under 7 per U.S. Dollar. They are now waiting for further develops. Until then, I wouldn’t be surprised by a short-term pullback in prices, especially if $1512.40 fails as support.
A sell-off from current levels won’t change the trend to down, but hopefully it will give longer-term traders a chance to re-enter at better prices. The nearest value zone on the chart is $1468.20 to $1455.20. Since the trend is up, a break back into this area is likely to draw the attention of buyers.
Holding above $1514.50 will indicate buyers are supporting the market. A break under $1512.40 will indicate the buying is getting weaker or the selling is getting stronger.
This article was originally posted on FX Empire
