Key Takeaways:
COMEX gold futures found support at $4,000 an ounce, with spot gold rising 0.9% to $4,068.34 an ounce on Wednesday.
"Latest positive price action on the daily chart suggests immediate support has formed at this level," Joseph Chai, analyst at RHB Retail Research, said in a report.
The precious metal appears to be undergoing consolidation and could move sideways along the $4,000 level, Chai said. Both the 20- and 50-day simple moving averages are trending steadily lower, which could put downward pressure on prices, he added. Initial resistance is pegged at $4,400 an ounce.
State Street Investment Management sees further upside, forecasting gold at $5,000 a troy ounce by early 2027. The bull cycle still has legs, with gold's status as a monetary hedge supported by rising government debt and resilient physical demand, the firm's strategists said. State Street expects baseline bullion prices to rally to $4,750-$5,500 an ounce over the next six to nine months. Global gold fund ownership as a portion of worldwide mutual fund and ETF assets remains below State Street's target of 3% to 10% for most portfolios, suggesting room for further inflows.
Federal Reserve Chairman Kevin Warsh said at a forum that price risks have come down in recent weeks, a less hawkish stance that could support gold, ANZ Research analysts said. Euro area inflation eased more than expected in June, while the US showed strong manufacturing activity and robust labor growth, the analysts added. A hawkish Fed pivot should not change the structural post-Covid dynamic for gold, State Street said.
Spot gold traded at $4,043.40 an ounce in early Asian trade, up 0.3%, before climbing to $4,068.34. The $4,000 support level aligns with the lower end of the commodity's recent consolidation range, with the 200-day simple moving average providing a secondary floor near that area.
This article is for informational purposes only and does not constitute investment advice.
