Gold Price Analysis: According to strategists at goldsilverreports.com, gold price needs to hold below the $1766 level neighborhood to maintain its immediate downside bias.
Gold (Yellow Metal) trades in a relatively tight channel on Wednesday. Modest rebound seen in US Treasury bond yields limits gold’s upside. Investors wait for FOMC to release the minutes of March 16-17 meeting.
- Gold bullish bounce finds increased resistance
- Bond yields threaten further upside correction in gold prices
The extreme long positioning in gold continues its sharp unwind
Gold Price Analysis: What is the prediction for gold prices?
“Gold has retested and again held key support at $1671 the 38.2% retracement of the entire 2015/2020 bull market and the recent and June 2020 lows.
“Above $1766, the gold (yellow metal) would see a near-term base established for a deeper recovery to $1855, but with a fresh cap looked for here.”
“CFTC Net Non-Commercial long positioning continues to unwind sharply from its extremes and the market is seen in a much cleaner and neutral positioning state.”
March was a mixed month for precious metals prices
“The largest move was in the price of palladium, which surged by 14% after Nornickel revised down its 2021 PGM production guidance by 15-20%. We think that the price of palladium will outperform the price of platinum over the next few years.”
A modest uptick in US bond yields has seen the US Dollar find renewed support, which is causing gold to undo some of yesterday’s gains. The US Dollar basket has halted a weekly decline and it will be key to see whether upside momentum is able to hold, which would put further downside pressure on gold.
Biden’s spending plan and improving economic data are cementing this upbeat economic outlook in the US, which is putting further pressure on the commodity’s safe-haven appeal.
Focus will be on today’s Fed meeting minutes where investors will be looking for any sign that the central bank will need to raise rates sooner than anticipated given stronger fundamentals. Bond yields will be key to the pricing dynamics of the US Dollar and therefore are likely to offer some trading momentum for gold.