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Date:
06th Apr 2021
Author:
Dalmas Ngetich, for AltumFx News Team

Gold Prices Stabilize; will $1.7k Hold?

Gold prices are stable, hovering above $1.7k as traders take a wait-and-see approach, waiting for a sell-off in the bond market to resume. Priced in USD, a bond sell-off would prop the greenback, sending the yellow metal down towards $1.7k in a bear trend continuation pattern of Nov 2020. Presently, there seems to be no limit on the number of cause-and-effect explanations of gold. Notably, the number of supportive-or correlated and even contradicting fundamentals has expanded in recent times, adding to the mire of confusion for traders.


Details: 

Gold is undoubtedly under pressure despite closing last week firmly. The yellow metal, in this time of uncertainty and money printing, acts as true money. Investors and banks hold it for several reasons. Some as a store of value, hedging inflation. For others, the precious metal is a medium of exchange. The strong NFP readings on Friday may dampen safe-haven performance in the medium term, negatively impacting the yellow metal. However, a recovering labor market raises inflation concerns in the medium term.


Impact on gold Prices: 

Bearish. Sellers are in control and may push the yellow metal below $1.6k as the USD looks likely to strengthen in the immediate term.


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