Comex Gold

Price of Gold Fundamental Daily Forecast – Patient Traders May Be Waiting for Powell’s Speech at Jackson Hole

Gold futures are trading flat in limited overnight action on Friday, but remained on track to post a second consecutive weekly gain as the major players remained on the sidelines amid uncertainty over the timing of the Fed’s tapering strategy.

The market is being underpinned ahead of the U.S. opening by a dip in U.S. Treasury yields, but a bump in the U.S. Dollar against a basket of major currencies to a multi-month high is helping to cap gains.

At 09:04 GMT, December Comex gold futures are trading $1784.70, up $1.60 or +0.09%.

Treasury Yields Fall Amid Delta Variant Concerns, Fed Taper Discussion

U.S. Treasury yields fell on Friday morning, amid continued concerns about the spread of the delta variant and discussion from the Fed of tapering bond purchases.

The yield on the benchmark 10-year Treasury note fell less than a basis point to 1.233%. The yield on the 30-year Treasury bond gave up 1 basis point, falling to 1.862%.

Treasury yields ebbed lower despite the latest meeting minutes from the Federal Reserve, released Wednesday, showing that central bankers were planning to taper bond purchases before the end of the year.

In addition, concerns about the spread of the delta variant continued to weigh on sentiment.

US Dollar Hits New 9-1/2 Month High as FX Traders Seek Safety

The U.S. Dollar hit a new 9-1/2 month high against major peers on Friday, buoyed by fears that the Delta coronavirus variant could delay the global economic recovery just as central banks begin to reverse pandemic-era stimulus.

“Trade-weighted measures of the dollar are pushing to new highs for the year. This comes at a time of bullish flattening in the U.S. yield curve – typically representing a more pessimistic re-assessment of growth prospects,” ING currency analysts wrote in a note.

“So even though the mood-music from the Fed is very much one of the glide-path to tapering, it looks like a lot of demand for the dollar is coming from investors pulling out of growth stories overseas.”

Minutes of the Fed’s July meeting, released on Wednesday, showed officials largely expect to reduce their monthly bond buying later this year.

Daily Forecast

Gold futures have been rangebound the last five sessions, but that doesn’t seem to be a problem, but rather just another indication of impending volatility.

Investors are being surprisingly patient, but can you blame them since the Federal Reserve is holding all of the cards on tapering. Patient traders could be waiting for Fed Chair Powell’s speech at the Jackson Hole symposium on August 26 -28, or the next Non-Farm Payrolls report, the next consumer inflation report or the Fed meeting on September 21-22 before making their next major move.

Everyone seems to be looking for a breakout over $1795.00 or $1800.00 so that could be a fake-out move. The best play may be waiting for a pullback into a value area at $1737.80 to $1723.60.

For a look at all of today’s economic events, check out our economic calendar.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.