ISA Bullion Gold Report – 5 August 2024

Market Overview

This report delivers a comprehensive analysis of the gold and silver markets, focusing on the fundamental and technical factors that influence current trends. Our aim is to equip investors with the insights necessary to navigate these markets effectively.

Fundamental Analysis

Despite a risk-off sentiment dominating Asian trading on Monday, gold prices are struggling to capitalize, as markets adopt a ‘sell everything’ approach. Concerns over a potential recession in the US, following a weak jobs report, are triggering risk aversion. Traders are cautious ahead of the ISM Services PMI data release and are closely monitoring developments in the Middle East geopolitical tensions.

Gold:

• The gold price needs to close above the previous highs of $2,450 to resume its uptrend toward the all-time high of $2,484 reached on July 17. Friday’s high of $2,478 could be retested if buyers regain momentum. The 14-day Relative Strength Index (RSI) is holding steady above 50, currently near 60, indicating that the bullish potential remains. On the downside, breaking below the 21-day Simple Moving Average (SMA) at $2,411 could lead to further declines, with support near $2,370. The short-term Stochastics Oscillator is at 70, and the Relative Strength Index is at 60.

Silver:

• Silver prices rebounded last week, ending a two-week losing streak, supported by key levels around $27.90 to $27.30. It closed at $28.60, a gain of $0.70 or 2.44%. The short-term Stochastics Oscillator is at 34, and the Relative Strength Index (RSI) is at 39.