This Could Cause the Gold Market to Reversal!
The current gold price is at $4,485, down slightly after hitting an all-time high (ATH). The decline in gold prices after hitting an ATH is often due to profit-taking, or investors who previously bought at a lower price. However, even if the gold price drops slightly, many factors could influence its future direction.
One of the main factors that could influence gold and silver prices is the economic data due to be released tonight, such as the ADP Weekly Employment Change and Prelim GDP. If this data shows a slowing US economy or a weaker-than-expected labor market, economic uncertainty could drive investors back to safe-haven assets like gold and silver, pushing prices up again.
On the other hand, if economic data shows continued strong US economic growth, this could strengthen expectations that the Federal Reserve will continue to maintain high interest rates to combat inflation. High interest rates typically make gold and silver slightly less attractive because their opportunity cost is higher compared to other risk assets.
Additionally, Core Durable Goods Orders and Durable Goods Orders will also be important indicators. If durable goods orders are lower than expected, this could indicate weakness in the industrial sector and domestic consumption, which in turn could increase economic uncertainty. In this situation, gold and silver could once again be seen as safe havens for investment.
However, if the data shows higher-than-expected figures, this could indicate that the industrial sector and the US economy are still strong, prompting investors to shift to riskier assets, which could further depress gold and silver prices.
So, will gold and silver prices reverse direction? That largely depends on how the economic data comes out tonight. If the data shows a weaker economy or high inflation, gold and silver could find support and rise again. However, if the data shows solid growth and well-controlled inflation, we could see a further downward correction in gold and silver prices. (asd)
Source: Newsmaker.id
