Gold looking promising – TDS

According to analysts at TD Securities, gold is looking promising amid recent Fed signals to hold rate increases and central bank buying.

Key Quotes

“Following several dovish Fed communications, which most recently included Fed Chair Jerome Powell, whose statement some believe pointed to a hard interest rate hike pause, has sent gold above the recent upper bound. The resulting weaker USD and lower rates all helped to move gold higher. News of near record central bank gold purchases also contributed to optimism surrounding the yellow metal.”

“We suspect that the high $1,290s and low $1,300s/oz are the new support levels, but we do not expect gold to surge for now. It seems to us that CTAs will need to get more signals before getting more aggressive in long acquisition, which won’t come until $1,360/oz or so. Meanwhile, despite the fact that the Fed has gone dovish, they could still hike one more time.”

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