Gold simultaneously reversed and fell sharply

Compared to the same time yesterday morning, the world gold price has decreased to 28 USD/ounce. The price of the yellow metal fluctuated strongly in the context that investors were still "analyzing" signals from the statement of US Federal Reserve Chairman Jerome Powell to better understand the direction of US monetary policy. US Central Bank. Positive signals from the US economy have made investors bet on the possibility that the Fed will delay its reversal to lower interest rates. Inflation in the US is still relatively high and the US Central Bank still wants to bring it back to the target level of 2%.

Witnessing the strong increase in gold prices after the Fed meeting, Reuters technical analyst Wang Tao optimistically predicted that spot gold could retest the resistance level at 2,222 USD/ounce. If this threshold is broken, it is very likely that gold prices will conquer levels in the range of 2,228 - 2,234 USD/ounce.

In the long term, despite the delay, the Fed has plans to cut interest rates this year, possibly 3 times and the starting time is in June. Normally, the US Central Bank will have many interest rate cuts when entering the monetary easing cycle. This also means the inevitable decline of the USD compared to many other currencies.

A falling USD will pull all commodities, including gold, up. The world gold price is forecast to rise to 2,200-2,400 USD/ounce in the second half of 2024.

Comment:

Comment:

Despite the pressure, expectations that the Fed will definitely cut interest rates this year, the demand of central banks along with the demand from retail investors and risk prevention are holding back gold's decline. . Gold will need to maintain support between 2,150 – 2,145 USD/ounce to continue its upward momentum.

Comment:

World gold prices may still be under pressure, as the US economy continues to announce new home sales in February. Currently, it is forecast that home sales in February are increasing compared to the previous month. If the data is as expected, it proves that the US economy is recovering positively, people have accumulated money to buy houses and invest in real estate. This will cause gold prices to continue to retreat further.

Comment:

This week, the gold market will receive information on US new home sales on Monday (March 25), the Richmond Fed survey on Tuesday (March 26), information on number of mortgage applications on Wednesday (March 27) and GDP growth figures for the fourth quarter of 2023 (last published); number of people applying for unemployment benefits for the first time; Pending home sales and the University of Michigan's consumer confidence survey results on Thursday (March 28).

Comment:

Our data shows traders are now net-long Gold for the first time since Mar 01, 2024 when Gold traded near 2,082.75. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger Gold-bearish contrarian trading bias.

Comment:

Meanwhile, the Bears' next near-term downside price objective is pushing futures prices below solid technical support at last week's low of $2,149.20 an ounce. First resistance was seen at the overnight high of $2,179.50 per ounce and then at the March 22 high of $2,188.00 per ounce.

Comment:

Yesterday, the financial market received more information about the US economy's mixed developments. Specifically, US CB consumer confidence decreased from 104.8 points in February to 104.7 points in March, much lower than the forecast of 106.9 points. Along with that, Richmond's manufacturing index in March also dropped sharply from minus 5 last month to minus 11.