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Gold Price News: Gold Bounces Back After Falling Below $2,640 an Ounce
Gold prices rose on Tuesday to recoup Monday’s losses, as the markets digested a mixed set of economic data from the US, while Middle East tensions continued to simmer.
Prices rose as high as $2,672 an ounce, compared with $2,636 an ounce in late trades on Monday.
US ISM manufacturing figures came out on Tuesday showing a slightly weaker reading than the market had expected for September, playing into calls for further interest rate cuts.
However, US JOLTS job openings numbers for August painted a better-than-expected picture on the US employment front, somewhat contradicting other signs of a weaker economy.
Gold’s volatility at the start of the week comes in the context of an all-time high of $2,686 an ounce on Thursday last week.
Yields on 10-year US treasuries fell on Tuesday, contributing to gold’s strength, although the yellow metal seemed unaffected by the US dollar, which strengthened against other major currencies. Read More
Silver Price News: Silver Reclaims $31.50 An Ounce
Silver prices climbed on Tuesday to recapture the moderate losses seen on Monday.
Prices briefly rose as high as $31.97 an ounce, although the market couldn’t sustain the gains, and prices eased back to just over $31.40 by early evening.
The trend on Tuesday followed the gold markets, which saw prices strengthen on Tuesday after a softer day on Monday. Silver’s slight weakness over the last few days followed a 12-year high of $32.75 an ounce on September 26.
The markets were mulling the implications of mixed economic data from the US on Tuesday, with manufacturing figures for September coming in below market expectations, while new job openings for August gave a better-than-expected reading.
In addition, ongoing conflict between Israel and Lebanese group Hezbollah continued to rattle the markets on Tuesday. Further raising the stakes, Iran launched missile strikes against Israel on Tuesday in response to its limited ground invasion of Lebanon, and this clearly highlights the risk that greater powers could be drawn into the conflict more directly, in a move that could further drive interest in safe haven assets. Read More
Goldman Sachs raises gold price target to $2,900/oz by early 2025 on sovereign buying, fund flows
Goldman Sachs announced on Monday that it has raised its gold price forecast by $200 per ounce, from $2,700 to $2,900, by early 2025.
“We reiterate our long gold recommendation due to the gradual boost from lower global interest rates, structurally higher central bank demand and gold’s hedging benefits against geopolitical, financial, and recessionary risks,” the bank said in a note.
Goldman Sachs also raised its average gold price forecast for 2024 to $2,395 per ounce from $2,357 per ounce, and its 2025 outlook to $2,973 per ounce from $2,686 per ounce.
“Our nowcast of central bank and other institutional demand in the London over-the-counter (OTC) market shows that purchases remained strong through July, averaging 730 tons annualized year-to-date, or about 15% of global annual production estimates, with a large contribution from China,” Goldman wrote. Read More
Middle East escalation may cause ‘knee-jerk reactions’ but gold and silver rallies will be driven by macro and rates – UBS’ Teves
While the escalating conflict between Iran and its proxies and Israel could cause short-term spikes in the gold price, the reason gold and silver will continue to rally higher has nothing to do with geopolitics, according to Joni Teves, precious metals strategist at UBS.
In an interview with Bloomberg Television on Tuesday morning before Iran’s missile attack on Israel, Teves was asked why gold hadn't moved much given the significant recent escalation in the Middle East.
“The impact of geopolitical uncertainty and risk on gold prices is not exactly straightforward,” she said. “Ultimately, the way we look at it is that it adds to the list of reasons why investors would want to hold gold as part of their portfolio to diversify and as a hedge against these types of uncertainties, but the immediate price reaction is not really straightforward.”
Teves said that what really matters for gold are interest rates and macroeconomic factors. “The way we look at gold is it's real rates that matter, macro factors are ultimately what drives gold,” she said. “There is potential for knee-jerk reactions when headlines come out, but ultimately the more sustainable impact on the gold price is really the interest that investors would want to have gold as part of their portfolio.” Read More
Gold maintains its purchasing power as it hits record highs against global currencies
Gold continues to dominate the global currency market, hitting record highs across the board; however, the precious metal also continues to demonstrate its value in the real world.
Last week, the European-based investment firm Incrementum AG published its annual iPhone/gold ratio, which underscores how gold continues to maintain its value.
The firm noted that for the third year in a row, the cost of an iPhone priced in gold bullion has dropped. According to the unique ratio, the iPhone 16 Pro with 1 TB of memory costs 0.60 ounces of gold, which is 23% less than last year’s 0.78 ounces of gold for the iPhone 15 Pro.
"Compared to 2022, the price of an iPhone measured in gold fell by almost a third, and compared to 2018, this year’s iPhone is almost 50% cheaper. 2018 was the only year a gold investor had to spend more than 1 ounce of gold for a brand-new iPhone," the analysts said. Read More
Gold price struggling as ADP shows US economy created 143K jobs in September
The gold market is seeing solid selling pressure and could continue to struggle, as the U.S. labor market remains robust and the private sector created more jobs than expected last month, according to payroll processor ADP.
On Wednesday ADP said that 143,000 jobs were created last month. The report handily beat expectations, as consensus forecasts called for job gains of 124,000.
“Job creation showed a widespread rebound after a five-month slowdown. Only one sector, information, lost jobs. Manufacturing added jobs for the first time since April,” the report said.
The gold market was already seeing some technical selling pressure ahead of the employment data and remains near session lows in initial reaction to positive labor market numbers. December gold futures last traded at $2,669.30 an ounce, down 0.78% on the day. Read More
Iran-Israel conflict is driving capital inflows into gold despite overbought conditions – TD Securities’ Ghali
Even as the market signals overbought conditions and Asian demand dries up, the increasing chances of a direct military confrontation between Iran and Israel is driving safe-haven inflows into gold, according to Daniel Ghali, commodity analyst at TD Securities.
“Selling activity in Gold has been a bit limited, but the top traders still liquidated nearly 5t of notional Gold over the last week,” Ghali said in a research note. “This contrasts with Western investor sentiment. Our read of macro fund positioning remains at its highest levels since the Brexit referendum in July 2016; re-levering from risk parity and vol-target funds is supporting a reaccumulation from CTAs and prices continue to rally without challenge.”
Ghali said that American and European interest is being driven primarily by worries about inflation and currency debasement.
“For Western investors, concerns surrounding monetary inflation are mounting as participants read the Fed's reaction function as asymmetric, at a time when the US economy remains decent by many measures,” he said. “We expected a more measured normalization of monetary policy to challenge bloated positions, given an aggressive global easing akin to current market expectations has typically occurred in response to deteriorating economic or financial conditions.” Read More
Mining sector modeling shows 20% upside, time for investors to pay attention - Gabelli Gold Fund’s Chris Mancini
After a strong rally that drove gold prices to a gain of 28% in 2024, the yellow metal has encountered resistance at $2,700 an ounce. While the precious metal still has room to move higher, one portfolio manager stated that the market doesn't necessarily need to go higher to generate significant value for investors.
In a recent interview with Kitco News, Chris Mancini, Associate Portfolio Manager of The Gabelli Gold Fund (GOLDX), shared his bullish stance on gold. However, he noted that even if gold prices consolidate around $2,650 an ounce, gold miners will still reap solid benefits.
“The economy has started to weaken, and it'll continue to do so, which means interest rates are going to decline further. We are going to see more and more advisors discussing gold, which will support ETF demand and help keep gold prices elevated,” he said. “If anyone starts paying attention to the mining sector, they should do really well.”
Mancini’s comments come as generalist investors continue to largely ignore the mining sector, despite the significant cash flow companies are generating with current gold prices. Read More
Middle East crisis shows Bitcoin is a risk asset, gold is the true safe haven – Analyst
Referring to Bitcoin (BTC) as a safe haven has drawn the ire of many precious metals advocates who tout gold’s long history of serving as a reliable store of value, while BTC’s price action is more akin to a roller coaster. According to one analyst, the latest flare-up in the Middle East has underlined this point as Bitcoin fell 6% while the yellow metal rallied higher.
“Today was yet another day marked by geopolitical turmoil, much like many others over the past year,” wrote Jesse Colombo, a precious metals analyst and investor. “This time, the turmoil was triggered by Iran launching at least 180 ballistic missiles toward Israel, marking the largest missile strike against Israel in history.”
“Israeli Prime Minister Netanyahu declared that Iran has made a grave mistake and will face consequences as the world inches closer to all-out war with each passing hour,” he added. “I hope for a peaceful resolution to this crisis, however unlikely that may seem.”
With the impetus for writing the article made clear, Colombo noted that its true purpose is to share his “observations on two assets often touted as safe havens—gold and Bitcoin—and how they perform during times of geopolitical crisis.” Read More
Gold pressured on profit taking, rebound in USDX
Gold prices are lower in midday U.S. trading Wednesday, on profit-taking and weak-long liquidation from the shorter-term futures traders. However, it appears a floor is under the market and bulls are likely looking to buy the dip at some point soon. A rebound in the U.S. dollar index today is also a negative outside-market element for the metals markets. Silver prices are firmer today. December gold was last down $18.20 at $2,672.30 and December silver was up $0.283 at $32.025.
Risk aversion remains elevated at mid-week, following Iran’s launching of 180 missiles against Israel Tuesday. Israel has vowed retaliation. Reads and Associated Press headline today: “The war is spreading across the Middle East; the question now is: How much can it be contained?” The historically rocky month of October for the stock markets is starting out just as such. This situation will likely keep a price floor under the gold and silver markets for the near term.
The Bank of England today released a study that said a survey of its banks said a record number see geopolitics as top risk, which could cause “sharp corrections” in the stock markets and other markets.
Technically, December gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,600.00. First resistance is seen at the overnight high of $2,684.50 and then at this week’s high of $2,694.70. First support is seen at Tuesday’s low of $2,653.80 and then at this week’s low of $2,646.20. Wyckoff's Market Rating: 9.0.
Image Source: Kitco News
December silver futures bulls have the firm overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below solid support at $30.00. First resistance is seen at today’s high of $32.59 and then at the September high of $33.02. Next support is seen at $31.50 and then at this week’s low of $31.155. Wyckoff's Market Rating: 7.0. Read More
Image Source: Kitco News
Bitcoin dips to $60k amid Middle East tensions, gold proves safe haven status
Asset prices struggled to gain their footing on Wednesday as traders adopted a cautious approach to investing amid the escalating Israel-Iran tensions, which have magnified worries about a wider Middle East conflict.
“Iran launched approximately 200 ballistic missiles at Israel on Tuesday, intensifying geopolitical tensions as Israeli Prime Minister Benjamin Netanyahu pledged a strong counterstrike,” noted analysts at Secure Digital Markets. “This escalation followed a series of Israeli attacks on Lebanon in recent weeks.”
“Bitcoin (BTC) reacted sharply to the development, posting its largest decline in over a month, with intraday losses reaching as high as 6% and 24-hour declines settling around 4%,” they added. “This marks the worst start to October for an asset that typically experiences bullish momentum during this period.”
It’s been a different story for spot gold, which has seen “an uptick as investors sought safe-haven assets,” the analysts said. And while the yellow metal has seen a slight pullback on Wednesday amid profit-taking, down 0.19% and trading at a price of $2,658.90/oz at the time of writing, the flight to safety could soon return as Israel has threatened to retaliate. Read More
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
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