Gold Prices: the precious metal’s old trend Shifting. This new week, the Jackson Hole Colloquium is in the limelight. T- Bond Yields in Focus

Gold seems to looking for a comeback

The prices of gold are making an effort to come back after being repressed over a while after the US dollar regained dominance. Given growing fears about China’s economic development, the feeling of security appeal could intensify.

The real yields have begun to decline on hopes that Fed Chair would shift from his present paradigm of elevated longer-term rates. To one with a more accommodating attitude. Should this occur, the Jackson Hole Economic Summit will be a probable venue.  while the cost of gold may benefit as a result. Given no other important data dumps scheduled until this week. Investors are expected to stay reasonably tranquil. The BRICS conference with the unveiling of China’s LPR earlier in the week may cause modest temporary volatility, although the whole focus is set on Jackson Hole picture.

Focusing at financial market prices, projections for markets have shifted dramatically in recent months. Including predictions ranging from Sept 2023 until the present May 2024 projection. More dovish direction forthcoming might accelerate this.  Perhaps lowering real rates more as well as working towards the favor of gold bullish traders.

The US Fed Factor

The spotlight will certainly be upon the Fed conference in Jackson Hole. Should the market perceive what is stated there to be putting a further rise in the US more probable, The XAUUSD might fall substantially. But we are convinced that Powell won’t choose a specific path.

Perilous debts are nearing maturation, that might trigger additional financial and market instability. The US Treasury rates dipped on last Friday as markets weighed the economic prospects, particularly inflation. Also speculated as to what the Fed’s monetary policy would entail.

Last week, investors poured a total of $3.2 billion onto the Invesco QQQ Trust Series 1 ETF, the largest weekly intake before Dec only. To witness the fund conclude a 4-week streak of victories lower 2.3 percent.

The QQQ’s rise from June low ones, fueled by investor hopes for a shift to more gradual treks. Which has fizzled following Fed officials cautioned that rates are rising while traders prepare to hear further aggressive language during the coming Jackson Hole summit.

Should the Gold Shorts Quit?

while rates of interest proceeded to increase rapidly. Despite the GDXJ ETF finishing near its latest month’s bottom. short-selling strategy profited more than usual. However, we are reaching a stage when switching long presents an appealing risk to reward scenario. Whilst we aren’t fully there yet. Traders will be among the first to find out once the choice is reached.

Though majority views remain aggressive, med-term economic consequences remain not yet factored into.

Based on the most recent Global Fund Manager Survey (FMS) from Bofa, majority of respondents projected the US funds rate (FFR) to reach a high within 3.25 percent to 3.75 percent in August. (the pale blue bars). In Sept. Nevertheless, the best place has shifted within the 4 percent to 4.25 percent area (the deep blue band).

Such a distinction a month produces, as an effect. Despite the fact that rate hiking predictions have risen significantly. Track the way the 4.5 percent to 5 percent & 5% over lines remain in the few. They include, in fact, their most possible consequences.

Inflationary Risk Inquiry chart

Source: Bofa GLOBAL RESEACH
Last week, investors poured a total of $3.2 billion onto the Invesco QQQ Trust Series 1 ETF, the largest weekly intake before Dec only. To witness the fund conclude a 4-week streak of victories lower 2.3 percent.

The QQQ’s rise from June low ones, fueled by investor hopes for a shift to more gradual treks. Which has fizzled following Fed officials cautioned that rates are rising while traders prepare to hear further aggressive language during the coming Jackson Hole summit.

Technical Perspective

The price of XAUUSD is approaching the pinnacle of the descending wedge graph formation. which had been building over a few weeks now. Pricing are approaching the bottomed level on the (RSI), indicating that there’s probably A space for additional decline. A breach over wedge barrier near the psychological mark of 1900.00 might trigger an upward rebound. whereas a closure beneath 1890.21 mark. It might lead to a greater sell frenzy into successive support regions.

Longer-Term View

the precious metal is actively sold when the price goes over $2,000. It is unlikely that the situation will change the next time buyers try to update the highs. The MACD indicator on the monthly timeframe looks weak and does not promise rapid growth in 2024. Therefore, do not expect any surprises from gold. Most likely, the sideways trend will continue in the upward channel, similar to the 2021 scenario, but at higher levels. There is a high probability that in 2024 there will be at least one attempt to update the historical maximum, and, most likely, it will be unsuccessful. However, for traders, this is rather good news since the easier it is to predict the market’s future, the safer it is to trade, and the higher the potential profit.