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#1 06-02-2019 09:10:45

Admin & Trader
From: Paris - France
Registered: 21-12-2009
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Gold now seems attractive on the market (TD Securities)

XAU: Gold now seems attractive on the market (TD Securities)

According to analysts at TD Securities, gold seems attractive given recent signals from the Fed that it should be necessary to slow rate increases and central bank purchases.

"Following a number of dovish Fed communications, including President Jerome Powell's latest statement, which some say was a pause in rising interest rates, gold was pushed above its recent upper limit. The weakening of the USD and the decline in rates that resulted have contributed to gold's rise. The near record gold buying news from the central bank also contributed to the optimism surrounding the yellow metal.

We think the new support levels are represented by the recent peak at 1290 and the trough at US $1,300/oz, but we do not expect a gold to soar for the moment. It seems to us that it will take more signals before becoming buying becomes more aggressive, which will not come until around 1360. At the same time, despite the Fed's dovish tone, they could still raise rates once more.

As the data are still good, which was underlined by the very strong impression of the January jobs report, ambiguity persists as far as we are concerned. The fiscal stimulus and the economic dynamism of the United States will probably not be negative for a few months. This means that gold will likely fall, even modestly, from current levels, on any additional positive data releases in the United States.

However, we expect gold above 1350-1400 in the second half of 2019, as it becomes clear that the US central bank will not move its policy towards restrictive territory.

"Anything worth having is worth going for - all the way." - J.R. Ewing



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