Gold Technical Report: Gold prices remained buoyant throughout last week continuing the trend of earlier week. The prices maintained the support of 10 days Exponential Moving Average and crossed above the 2000 mark convincingly. The main hurdle remains near recent high of 2012 on closing basis.The short term Stochastics Oscillator is at 90 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 64 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices are also trading nervously showing weakness below 24.00 mark. Near the day high it witnessed profit booking but managed to close above 10 days Exponential Moving Average. If this strength persists, it can try to reach Aug Highs of 25.00 mark as a new target. The Short term Stochastics Oscillator is at 78 and Relative Strength Index near 58.
Fundamental Report: Gold prices last week, surged past the significant $2,000 threshold, marking the second consecutive week of gains. This increase was largely in reaction to a weakening U.S. dollar, fueled by speculation that the U.S. Federal Reserve might pause its interest rate hikes. The dollar index, reflecting the U.S. currency against six major peers, declined by 0.4%, heading towards a second successive weekly drop. This downtrend is attributed to disappointing economic data, intensifying beliefs that the Federal Reserve may shift to a more dovish stance in the near future. Market anticipations are increasingly leaning towards potential rate cuts by the Fed as early as May next year, a sentiment that augurs well for gold prices. U.S. Treasury yields saw an uptick last week, with the benchmark 10-year yield rising over 5 basis points on Friday, as investors continued to evaluate the interest rate outlook and the broader economic scenario. Despite the recent meeting minutes from the Federal Reserve not indicating imminent rate cuts, market sentiment remains fixed on a 99.5% probability of rates being maintained at the current range in the upcoming December meeting.
The upcoming week’s trends in the gold market will likely be determined by ongoing evaluations of interest rate movements and key economic data. The decisions of the Federal Reserve, fluctuations in the U.S. dollar, and Treasury yield dynamics are expected to play pivotal roles in influencing the trajectory of gold prices. While the possibility of medium-term rate reductions offers a potentially bullish environment for gold, immediate price trends may be more restrained due to active economic analysis.