After a strong breakthrough last week, gold price prospects continue to be assessed as positive in the short term. A survey by a precious metals website with Wall Street experts shows that most analysts are leaning towards the scenario of gold price increase next week, while no experts predict this precious metal will decrease in price.
Among the 11 experts participating in the survey, 8 opinions expect gold to continue to rise, accounting for about 73%. The remaining three opinions believe that gold prices may move sideways to consolidate the upward momentum, no expert gave a scenario of deep decline.
Not only analysts, the psychology of individual investors also maintains optimism. In an online survey with more than 200 participants, nearly 78% of investors expect gold prices to increase next week.
So what are the bases that are strengthening investor confidence, causing a series of experts to make positive predictions about gold price prospects next week?
Weakening USD creates momentum for gold
One of the important factors supporting gold prices today is the weakening of the USD. When the greenback depreciates, gold often becomes more attractive to investors holding other currencies, thereby boosting buying demand.
The market is paying attention to changes in the monetary policy expectations of the US Federal Reserve (Fed). Although some US economic data still shows recovery potential, expectations of the Fed maintaining or moving towards policy easing are still supporting the precious metals.
In addition, US bond yields show signs of pressure after developments related to the US Treasury Department's long-term bond buyback plan. This has caused a part of investors to increase their interest in hedge assets such as gold.
Fiscal and geopolitical concerns boost shelter demand
According to analysts, the current increase in gold does not come from a single factor but is a combination of many drivers.
Issues related to the US public debt level, increasing interest payment costs, and concerns about fiscal health are causing investors to look for assets that can protect value.
In addition, geopolitical tensions, especially instability related to the Middle East region, continue to maintain safe haven demand. Oil prices remaining at a high level also makes the market more concerned about inflation risks, thereby supporting gold's defensive role.
Important technical threshold after breakthrough
Technically, gold prices are showing a positive trend after surpassing many important resistance zones.
The precious metal has surpassed the 4,500 USD/ounce mark and remained above the 200-day moving average, a signal that investors often consider positive for the long-term trend.
Some technical analysis suggests that if gold continues to hold firmly above the important support zone and surpasses the 4,600 USD/ounce mark, the market may head towards higher price zones. Conversely, if the USD recovers strongly or bond yields increase again, gold may face a short-term correction.
Market awaits signal from US economic data
Next week, the focus of the market will be on a series of US economic data, including consumer confidence index, new home sales, core PCE inflation index, Q2 GDP growth figures and the jobs report.
In particular, Fed Chairman Kevin Warsh's speech at the Jackson Hole conference is considered an important event, because the market is looking for more signals about interest rate orientation in the near future.
If new data shows that inflationary pressure is decreasing and the Fed has more room to ease policy, gold may continue to receive support. Conversely, too strong economic signals could cause bond yields to rise and put pressure on gold prices.
The article updates market developments, not investment recommendations; investors need to consider before making a decision.
