24K99 news: Gold closed this week at $2562, sliding down from the weekly high of $2685. The "Trump Trade," in combination with the usa consumer price index (CPI), producer price index (PPI), and shocking retail sales data, has boosted the usd significantly, pressuring the bid for precious metals. Federal Reserve Chairman Powell sent clear hawkish signals, stating that the Fed is not in a hurry to cut rates given the robust usa economic data. A gold price survey shows that Wall Street once again has only a few people believing that gold has potential for short-term gains.

(Source: FX168)

The usa data released on Friday showed that retail sales in October increased by 0.4% month-on-month, slightly above traders' expectations of 0.3%, while the September report's month-on-month growth was significantly revised to 0.8%, up from the original report of 0.4%. The CPI data was hot prior to this, with this week's usa consumer and producer price index reports indicating "sticky" inflation.

Powell delivered a slightly hawkish speech on Thursday, stating that due to strong economic data, the Fed is not in a hurry to cut rates. David Morrison from Trade Nation remarked in an email that Powell's speech and the subsequent Q&A session successfully frightened the market. He stated that the usa economy is not signaling that the Fed should rush to lower rates. His comments led to a market pullback and rising bond yields.

The cme group's Fed Watch tool showed a sharp reversal in rate cut expectations. Meanwhile, the Boston Fed stated on Thursday that a rate cut by the Fed in December is "certainly under consideration, but not yet a done deal."

Next week's sentiment survey.

The latest Kitco News weekly gold survey shows a strong bearish sentiment among industry experts, while retail traders are increasingly concerned about gold's recent prospects.

This week, 12 analysts participated in the Kitco News gold survey, and once again, only a few people on Wall Street believe that gold has upside potential in the short term. Only 3 experts (25%) expect gold prices to rise in the next week, while 6 analysts (50%) predict that gold prices will decline again. The remaining 3 analysts (25% of the total) expect gold prices to continue consolidating with a downward trend.

Meanwhile, Kitco's online survey received a total of 181 votes. Although overall sentiment remains much higher than that of industry experts, the sentiment of ordinary investors has further declined into the pessimistic range. 78 retail traders (43%) expect gold prices to rise next week, while another 71 (39%) expect gold prices to fall. The remaining 32 investors (18% of the total) expect gold prices to consolidate in the near term.

(Source: Kitco)

Mark Leibovit, publisher of the VR Metals/Resource Letter, stated: "Gold prices are experiencing a correction as expected, with risks at $2,300. The long-term target of $3,700 remains unchanged. It's a bit oversold here, so we may see a rebound," he added. "Buy low for long positions and scoop up long positions for trading."

Darin Newsom, senior market analyst at Barchart.com, stated: "The euphoria from the recent U.S. presidential election might be coming to an end, which means that the reality of upcoming market turmoil is starting to set in. Given this, gold may once again see inflows from investors seeking safety, as a hedge against other market sectors (especially stocks)."

David Morrison, senior market analyst at Trade Nation, noted that despite recent technical improvements, it is still too early to claim a bottom has been reached. "Bullish hopes (which isn't the best strategy) that the sell-off since Trump won the presidential election last week has ended," he said. "There are currently no signs that the situation has ended, and gold has been declining daily this week, dropping more than 5% in just four days. This does not even consider the losses from the week before the election. However, there may be some good news. Although gold fell again yesterday, it indeed managed to rebound strongly from its lows, and this trend is continuing this morning. Gold remains severely oversold, with the daily MACD falling to levels not seen since July 2022. Meanwhile, the price rebound since Friday has led the shorter-term MACD to flatten out, and even show signs of a rebound."

"This doesn’t guarantee that prices will start rising from now on, let alone tell us whether the rebound will be brief or more sustained," he warned. "But it is a start. However, gold still has a lot of work to do to convince investors that the highs are not yet in place."

James Stanley, senior market strategist at Forex.com, stated: "Upwards. Gold was hit hard this week, and I think this was a profit-taking move in the large cap trends. Spot gold found support at $2,550 on Thursday and this level has held as of Friday. I believe that if gold does see trading next week, the $2,500 level may become key, but I do not expect the Trump administration to reduce debt, so I believe the fundamental resistance still favors gold."

"Gold was severely overbought at that time, and in that context, this correction makes sense, and as people's attention turns to bitcoin, funds seem to flow elsewhere," Stanley added. "However, I think gold is starting to look more attractive, especially with some key support levels nearby."

Adrian Day, president of Adrian Day Asset Management, stated, "It is neutral. Gold may take some time to find its foundation."

Sean Lusk, co-head of commercial hedging at Walsh Trading, is analyzing the various factors leading to the decline in gold prices, primarily the soaring dollar. "The dollar has made a significant recovery and is climbing rapidly," he said. "Energy, on the other hand, is performing poorly, and the deflationary environment has worsened since the election. The dollar is skyrocketing, and bond yields are continuously rising, putting pressure on the futures market. Despite the optimistic trading in the S&P index, there is a disconnect between the normal reversal of a stronger dollar, rising yields, and weaker gold. Regardless of how the stock market performs, this situation is finally starting to appear."

Lusk noted, "Listen, we thought a correction was coming. I thought it would happen before the election, and they would cut some rate decreases. Surprisingly, this happened after the election with Trump's victory. This pushed the dollar higher. But I think more importantly, the Federal Reserve has undergone a drastic change; they are no longer so dovish, but rather more hawkish. They will rely entirely on data while Powell is reducing some rate cuts."

Lusk pointed out that the value of December contracts has dropped $260 from the Halloween peak. "This is a huge drop in a short time," he said. "This is a shift change. This is not an adjustment."

He now expects that central banks will return to the market to buy commodities at lower prices. "But a lot of funds are flowing into our market and dollar," he said. "Europe's currencies continue to weaken, putting pressure on the euro. They are buying back dollars against euros, pushing the euro to new highs. At least for now, what we are seeing is purely deflationary trading, and not just in the metals sector. We are also seeing this in other areas, especially food and energy. This is where adjustments will occur."

Lusk believes that when the demand for gold in the market rebounds, it is likely to happen at the end of the year, driven by Europe and developing countries. "I believe that unless geopolitical factors enter the market, or someone says something, or there are some exceptionally bad data from somewhere, or the threat of force resurfaces, gold prices may continue to move sideways for a while, which will obviously lead to some bid returning," he said. "But I just feel that, from a bigger perspective, nothing has changed. The excitement brought by the recent election will gradually fade, as it always does. So, where would you prefer to buy in? That is the real big question. These are all major levels. We should see a pullback."

Lusk also expects, "Over time, maybe not now, but in a month, central banks will start to pay attention to this issue and say, 'We need to do something?' Especially if we have to continue injecting stimulus measures and implement all these dovish policies to stimulate growth, we will have to support it in some way, shape, or form. Then people might start to take an interest in gold."

Gold technical outlook.

Kitco states that, from a technical perspective, December's gold bears have an overall recent technical advantage. Prices are trending downward on the daily chart. The next upside price target for bulls is to close above the strong resistance level of 2,650.00 USD. The next recent downside price target for bears is to drive futures prices below the solid technical support level of 2,500.00 USD. The first resistance level is at Thursday's high of 2,585.80 USD, followed by 2,600.00 USD. The first support level is at the overnight low of 2,558.90 USD, followed by this week's low of 2,541.50 USD.

(Source: Kitco)

FXEmpire analyst James Hyerczyk reports that gold prices experienced the largest weekly drop in three years, closing at 2,563.22 USD, a decrease of 4.52% or 121.23 USD. Ongoing pressures from a strengthening dollar, rising U.S. Treasury yields, and shifts in Federal Reserve policy expectations led to the decline in gold.

Last week, U.S. Treasury yields surged, with the 10-year Treasury yield climbing from 4.298% earlier this week to 4.505%. Driven by expectations of long-term high interest rates, this rise has increased the opportunity cost of holding gold. Federal Reserve Chair Powell reiterated that rate cuts are not urgent, further exacerbating this sentiment and diminishing gold's appeal as a non-yielding asset.

The dollar soared to a one-year high of 107.064, which dealt a heavy blow to gold prices. Supported by stronger-than-expected economic data such as a 0.4% growth in October retail sales and revisions to September data, the strengthening dollar has reduced gold's attractiveness to international buyers. With the dollar maintaining its dominance, gold has lost its footing as a hedge against economic uncertainty.

Inflation data shows that the core CPI is at 3.3%, far above the Federal Reserve's target of 2%. This has prompted a shift in expectations for rate cuts, with the likelihood of a December rate cut dropping from 83% earlier this week to 59%. Gold, benefiting from a low-rate environment, faces additional selling pressure as traders adjust to the possibility of stable long-term rates.

From a technical perspective, gold's closing price this week was slightly above 2,533.76 USD, maintaining this key support level. Failure to hold this support level could lead to an accelerated decline in gold prices to the 50% retracement level of 2,387.23 USD. Resistance levels are at 2,571.68 USD and 2,631.04 USD, with last week's high at 2,686.17 USD and low at 2,536.85 USD.

The short-term outlook for gold remains bearish, as the continuing strength of the dollar and rising yields may keep prices under pressure. A drop below 2,533.76 USD could open the door for further declines. However, stabilizing at current levels could trigger a technical rebound, breaking through 2,571.68 USD. Traders will closely monitor upcoming Federal Reserve comments and economic data for clearer direction.

(Source: FXEmpire)