Gold price trending on a thin sentiment globally!

 

Rapidly changing scenario for gold price ahead of festive! 

Recently Swann Collins, investor, writer and consultant said Eurasian media on September 26, 2024 that, “Gold prices run above $2,690 marks its continuous push to record highs so far this year. This is a +5.48% growth over the past month, and a +40% growth over the past year. 

Last month gold price crossed $2,500 per Troy ounce. Interest rate cuts by the US Federal Reserve last week reduced the opportunity cost of holding non-yielding gold. 

Expectations for further U.S. interest rate cuts have driven up demand for non-yielding assets like gold. Traders are pricing in a 62% probability of a 50 bps rate cut by the Fed in November, as indicated by the CME FedWatch tool. Fed Chair Jerome Powell’s upcoming remarks are expected to shed light on the extent of future rate adjustments, which will further guide gold’s direction.

Heightened global uncertainty, such as the ongoing Israel-Gaza conflict, has also increased demand for gold as a safe-haven asset against inflation and geopolitical turmoil.”  

Sandip Raichura, CEO - Retail Broking and Distribution, Director - PL Broking and Distribution analysed that “Yesterday- on 24^th September, gold reached an all-time high of approximately $2,640 per ounce in U.S. markets. 

Following this peak, profit-taking led to a slight decline, further exacerbated by a modest recovery in the U.S. Dollar Index, which measures the dollar against six major global currencies. 

Additionally, geopolitical tensions, particularly the crisis in the Middle East and the ongoing Russia-Ukraine conflict, are positively impacting gold. China has been aggressively accumulating gold at various price points since $2,200. After gold broke out of the $2,080 to $2,100 range, long-term projections suggest a target around $2,900.    

In the very short term, however, a pullback may occur, with a near-term bottom expected at around $2,540. If that level is breached, the next critical support would be approximately $2,480. While this scenario could lead to a temporary downturn, it seems unlikely. We believe that after a potential correction of $60 to $100, gold will likely regain momentum and aim for $2,700 in the near future.”