Gold suffered again last week, falling to a new low for 2023 as long-term US interest rates continue to rise. Earlier in the year, traders were hoping for interest rate cuts in the fourth quarter of 2023, but now the current forecast is May 2024. With few other news events for Gold traders, rising interest dominates market sentiment and pushes prices lower.
Fed Chairman Powell speaks this week at the Jackson Hole Economic Symposium and is likely to give an outlook for the future of interest rates. Any hints that the Federal Reserve could reduce official interest rates than expected could see Gold rise significantly. Also, the growing concerns regarding Chinese growth could encourage safe haven Gold buying should the situation worsen.
The technical picture continues to look poor for Gold, but buying remains the best risk-reward trade at the moment. Looking to buy should Gold recover back above the 2023 year low could be the best opportunity this week.
Resistance: 1893, 1900, 1925, 1938, 1925, 1984, 2000
Support: 1870, 1830
WTI broke its recent uptrend when prices closed below the 10-day moving average at the start of the week. Concerns regarding the Chinese economy and the failure to hold above resistance at $83.50 gave bulls confidence to enter short positions. China is the world`s largest oil importer, so continued problems in the Chinese property market could result in more aggressive selling.
The week ahead will see the market closely watch developments in China, and more selling is likely. The 10-day moving average could now act as resistance and help traders find selling opportunities in the week ahead.
Resistance: 83.50, 90.00
Support: 78.50, 75.00, 70.00, 67.00, 65.00, 64.00