GOLD Analysis
Afternoon: Gold Holds Steady Amid Anticipation of Further U.S. Interest Rate Cuts
Highlights:
- Gold prices remained steady amid expectations of another U.S. interest rate cut this year.
- U.S. jobless claims fell to a four-month low, complicating the rate cut outlook.
- China's net gold imports via Hong Kong dropped 76% in August, the lowest in two years.
Overview:
Gold prices remained stable as market participants anticipated another substantial interest rate cut in the United States before the year ends. Bullion prices have surged over 29% this year, driven by expectations of monetary easing, heightened safe-haven demand, and continued central bank purchases. The Federal Reserve recently cut rates by 50 basis points, and market sentiment suggests another half-point reduction in November, according to the CME FedWatch Tool.
Positive labor market data in the U.S. added some complexity to the rate-cut narrative, as jobless claims fell to a four-month low of 218,000. On the global front, China's monthly net gold imports via Hong Kong plummeted by 76% in August, the lowest level in over two years, signaling a potential shift in global demand dynamics.
Despite this, rising inflation concerns and looming monetary easing have solidified gold's status as a safe haven. Investors are closely watching for key economic data releases, including the Core PCE Price Index and Goods Trade Balance from the U.S. Zone, along with the Spanish Flash CPI and German Unemployment Change in the Euro Zone, which could further influence the direction of gold prices.
Action Plan:
Buy gold around $2664, targeting $2685 with a stop loss at $2652.
Support and Resistance Levels:
