Increase - Mr. Adrian Day, Chairman of Adrian Day Asset Management, commented. The resumption of large-scale Treasury bond purchases by the US Federal Reserve (Fed) is creating a positive support for gold prices.
Similarly, Mr. James Stanley - senior market strategist at Forex.com said that gold prices this week increased:
" James Stanley - senior market strategist at Forex.com - said that gold prices are still in a strong uptrend. According to him, gold has just broken out of a technical model of price increase, while the only remaining notable resistance is the all-time high.
At the moment, there is no reason to turn to the negative view, Mr. Stanley said. He said gold is in a favorable position to continue to rise in the long term, with the prospect of price increase lasting until 2026. This expert affirmed that he will maintain an optimistic view on gold until there are clear signs of cooling inflation, enough for the Fed to slow down monetary policy to tighten".
Mr. Marc Chandler - CEO at Bannockburn Global Forex - commented: "The accumulation period of gold is really constructive, and the basis spot gold price reached nearly 4,340 USD/ounce last weekend. The Fed's purchase of the Treasury note (T-bill) may have boosted new buying power more than the rate cut."
He also said that the Bank of Japan (BOJ) may raise interest rates, while the Bank of England (BOE) is likely to cut interest rates next week.
A stronger US dollar may have also contributed to supporting the yellow metal. However, the market has absorbed a large amount of information, and if the greenback enters the accumulation/adjustment phase while US yields remain high, gold could stagnate ahead of the recent peak around $4,380/ounce," Chandler added.
Alex Kuptsikevich, senior market analyst at FxPro, expects gold prices to continue to increase this week, but he believes that the price increase cycle is getting closer to the end.
Gold started the week quite quietly, but prices accelerated on Thursday and Friday, helping the whole week increase by more than 3.5% to 4,340 USD/ounce. This is only 0.8% lower than the historical peak.
The precious metal is experiencing a real "crazy" at the end of the year, instead of cooling down to make a profit as expected. Silver (+120%) and platinum (+90%) have even performed better than gold in the past year. This strong increase further affirms the strength and seriousness of the price increase," he said.
Kuptsikevich said: The Bank for International payments (BIS) noted that for the first time in 50 years, gold and US stock indexes are moving together as risk assets. This increase is speculative and shows signs of a bubble. The majority continue to buy stocks and precious metals, while smart money is looking for opportunities to sell or remain neutral."
He said that this week could start with a "short squeeze" (a phenomenon of strong property price increases that force fake investors to buy back to cut losses) for gold and other metals, but the subsequent developments are noteworthy.
We think gold prices are rising too strongly and the current uptrend is about to end, Kuptsikevich said. After reaching its peak, gold prices could enter a period of decline that will last for many years.
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