The gold market saw significant swings early in the week, with spot prices starting above $2,041 an ounce before falling to a low of $2,016 on Monday morning. Throughout the week, gold prices mainly traded within this range, reaching a from $2,042.53 on Wednesday morning and repeatedly testing support near the $2,021 level. Despite this volatility, sentiment towards gold has remained cautiously optimistic.
The last Kitco News Weekly Gold Survey indicated a consensus forecast of stable prices with a chance for gains in the coming week. Analysts and investors have expressed divergent opinions regarding the factors influencing gold's direction, including inflation data, geopolitical developments and U.S. economic indicators.
Adrian Day of Adrian Day Asset Management viewed gold's sideways movement positively, suggesting it could find a base and move higher after a recent decline. Similarly, Forex.com's James Stanley remained optimistic, citing gold's resilience despite a rally in the US dollar.
Bob Haberkorn of RJO Futures highlighted market reactions to Chinese data and rising stocks as factors affecting gold prices. He highlighted the importance of upcoming US inflation data in determining the near-term direction of gold.
Analysts and experts expressed mixed feelings regarding gold's near-term outlook, with some anticipating a breakout of the current sideways trend while others expected continued consolidation. Geopolitical events, such as developments related to former President Donald Trump's Supreme Court trial, have also been seen as potential catalysts for market movements.
Despite differing opinions, most analysts agree that gold prices will likely remain within their recent range until further significant market developments occur. At the last update, spot gold was trading slightly higher but remained lower for the week.
Let's take a look at the weekly standard deviation report published on Market Place and see what short-term trading opportunities we can identify for the week.
GOLD: Weekly Standard Deviation Report
February 10, 2024, 10:16 a.m. ET
- Gold futures closed below the 9-day SMA, confirming bearish weekly trend momentum.
- The market closed below the weekly VC Price Momentum Indicator, confirming bearish price momentum.
- Consider taking profits on short positions at 2026-2014 levels and look for potential turning points for long positions.
Weekly trend momentum: Gold futures closed at 2039, below the 9-day simple moving average (SMA) of 2062, confirming downtrend weekly momentum. A close above the 9-day SMA would neutralize the short-term downtrend to the point of neutralizing it.
Weekly price momentum: The market closed below the weekly VC price momentum indicator at 2044, confirming bearish price momentum. A close above this indicator would neutralize the short-term downtrend to the point of neutralizing it.
Weekly Price Indicator: For short positions, consider taking profits on corrections to 2026-2014 levels and consider going long on a weekly reversal stop. If long, use the 2014 level as a monthly Stop Close order only and good until canceled. Look to take profits on long positions as the market reaches the 2056-3074 levels during the month.
Ride a bike: The due date for the next cycle is 15.2.24.
Strategy: If short, consider taking profits at 2026-2014 levels.
This information suggests bearish sentiment in the near term, with profit-taking opportunities on short positions and potential turning points for long positions. Traders should closely monitor the market for any changes in trend or momentum.