Investors, seeking stability in these uncertain times, are turning to gold as a hedge against inflation and as a safe haven asset. This surge in demand has pushed gold prices to unprecedented levels. Experts, like Matt Willer of Phoenix Capital Group and Eric Croak of Croak Capital, highlight the combined effects of economic indicators and global tensions on gold’s appeal. With U.S. economic indicators showing softness, the demand for gold is on the rise, while other commodities face reduced demand.
Record Prices and Market Factors
Spot gold has seen a substantial increase, logging its best month since July 2020 with a 9% rise. U.S. gold futures also settled higher. The driving forces include anticipation of rate cuts by the Federal Reserve and robust safe-haven demand. Daniel Ghali of TD Securities notes the role of traders adjusting positions before holidays and increased trading activity at month-end and quarter-end.
Short-term Forecast and Long-term Potential
In the short term, experts like Eric Croak expect volatility, with prices potentially fluctuating between $2,140 and $2,200 per ounce. Stephen Akin of Akin Investments suggests that technical analysis points to a potential rise to $2,300 – $2,400 in the next one to two years. Despite potential short-term pullbacks, the overall outlook for gold remains bullish. Sean Casterline of Delta Private Wealth anticipates that any pullback would be limited, with previous resistance levels now forming support.
In conclusion, the combination of ongoing geopolitical tensions, economic indicators, and market sentiment suggests a bullish forecast for gold in both the short and long term. Investors and traders should closely monitor these factors for insights into gold’s future performance.
