Fundamental Forecast for Gold:Bullish
Gold Talking Points:
Gold[1] prices were fractionally softer this week with the precious metal shedding 0.1% to trade at 1203 ahead of the New York close on Friday. The loss comes on the heels of a strong rebound in bullion with prices trading just below resistance into the close of the month. Heading into the start of September trade our outlook remains unchanged as we look for further confirmation that a more significant low was registered in August.
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Trade War / Geo-Political (EM) Concerns Offering Gold Support
The ongoing trade skirmish has kept a floor under gold prices[3] and although equity markets have continued to press higher, seasonal tendencies for stocks turn heavy heading into September and ongoing geo-political concerns may further stoke demand for the perceived safety of the yellow metal. That said, the focus remains on the technical considerations we’ve been tracking over the past few weeks[4] with expectations for limited downside in the days ahead.
Highlighting the economic calendar into the start of the month will be central bank interest rate decisions from the RBA (Reserve Bank of Australia) and the BoC (Bank of Canada). US August NFPs (Non-Farm Payrolls) are released on Friday with consensus estimates calling for a print of 194K as unemployment holds near 18-year lows at 3.9%.
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Spot Gold IG Trader Sentiment
- A summary of IG Client Sentiment[6] shows traders are net-long Gold- the ratio stands at +4.85
