Investors Wait and See, Gold Weakens During Thanksgiving Holiday
Gold prices weakened in the current Asian session, primarily due to risk-on sentiment in global markets. Expectations of a Fed interest rate cut in December and optimism regarding the possible progress of a Russia-Ukraine peace deal have made market participants more willing to invest in riskier assets such as stocks. This shift in capital flows from safe-haven assets to riskier assets has automatically reduced buying interest in gold, causing the price to correct from its highest level in almost two weeks.
Furthermore, gold's decline was also triggered by profit-taking following a strong rally in the previous session. Many traders chose to lock in profits when prices had already risen, leading to increased selling pressure in the Asian session. However, this decline is likely to be limited, as expectations of a Fed interest rate cut and a weaker US dollar remain supportive factors for gold in the near term.
Thin Liquidity Due to Thanksgiving Holiday — Volatility Controlled
One factor currently influencing gold market dynamics is the Thanksgiving holiday in the US. Market conditions with low liquidity tend to limit extreme price movements.
As a result, although fundamental sentiment supports gold, today's price is expected to move more cautiously. Overly aggressive movements are less likely in quiet market conditions.
Outlook & Predictions Until the Week's Close
With the above background, here is the gold price prediction until the end of this week:
Gold prices are likely to consolidate within a relatively narrow range, with support and resistance around USD 4,140–4,170 per ounce. If the market remains calm and no major data emerges, gold may move sideways.
However, if expectations of an interest rate cut intensify—or if disappointing US economic data emerges—there is potential for gold to resume its rally with a short-term target of USD 4,200 per ounce.
Conversely, if the US dollar strengthens again or there are signs that the Fed will delay a cut, gold could be pushed below the support level, entering the USD 4,050–4,100 range.
Currently, gold appears to be on the defensive—supported by expectations of loose US monetary policy, but limited by low liquidity due to the holiday.
Source : Newsmaker.id
