Experts disagree on gold price forecast this week

Experts predict gold price this week

Darin Newsom, senior market analyst at Barchart.com, is one of the experts who has a positive outlook on gold prices in the short term. This expert believes that the upward trend of gold prices will continue until it is affected by an external force.

“That external force is usually investor activity. But given the likelihood of global turmoil only increasing in the coming month, investors are not going to change their minds about gold as a safe haven,” said Darin Newsom.

Kevin Grady, president of Phoenix Futures and Options, said he was not concerned about last Friday's drop in gold prices.

"I think the correction is normal and healthy. The rally can't continue. I think the interest rate picture will continue to be positive for both metals and stocks."

Grady said that while market expectations appear to be changing, he does not see the Fed cutting another half-point at its next meeting.

Grady said there is a chance that the U.S. jobs picture will deteriorate between now and the end of the year. All of this is very positive for gold, even if prices fall and retreat.

“I think there is a psychological level for gold at $3,000 an ounce that has never been reached. The sell-off last week really helped the new rally. People who really want to own gold for the long term are buying on the dip. I like the sell-off. I think the sell-off is helping.”

As for when the market could break $3,000 an ounce, Grady said it’s hard to say because the U.S. is going into an election, and “I think that’s the wild card. If interest rates continue to come down, you’ll see gold prices rise.”

James Stanley, senior market strategist at Forex.com, is bullish on the week ahead. Meanwhile, Alex Kuptsikevich, senior market analyst at FxPro, said the market is entering a strong bullish phase for gold.

Kuptsikevich said that profit-taking last Friday “is both a catalyst for further growth and a sign of uncertainty at this stage of the market.” Market participants are now looking for signs of overbought conditions, Kuptsikevich said.

On the other hand, Ole Hansen, head of commodity strategy at Saxo Bank, said that gold prices will fall lower "because I believe that this rally is being driven by fear of missing out and traders chasing momentum using derivatives. In the short term, physical demand is likely to dry up until investors adjust to these new and higher prices."

Mark Leibovit, publisher of VR Metals/Resource Letter; Michael Moor, founder of Moor Analytics; and Kitco senior analyst Jim Wyckoff share the same view, predicting that gold prices will fall this week.

Economic events affecting gold prices this week

The main economic news event this week will be the US September non-farm payrolls report, released on Friday morning. Other important data include the European CPI on Tuesday, the US services purchasing managers index (PMI) and JOLTS job openings report, the ADP jobs report on Wednesday and the US weekly jobless claims report on Thursday morning.

Markets will also be closely listening to what Fed Chairman Jerome Powell has to say at the National Association for Business Economics (NABE) annual meeting today. This will be Powell’s first live event since the central bank’s monetary policy meeting last week.