Gold continues to fall sharply

The strong recovery of the USD on the last trading day of the week put strong pressure on gold. World gold price stood at 2,165 USD/ounce, down sharply by 19 USD/ounce compared to the same hour yesterday morning.

The strong recovery of the USD on the last trading day of the week put strong pressure on gold, causing gold prices to decrease by 0.7%. However, analysts say that with inflationary pressure and the US Federal Reserve's (Fed) stance on three interest rate cuts in 2024, world gold prices will react positively in the near future.

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. . Streible added that gold will need to maintain support between $2,150 and $2,145 per ounce to continue its upward momentum.

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.