Gold Price, Silver Price Shakeout Has Not Changed Fundamental Background
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Gold (XAU) Price, Silver (XAG) Price Analysis and Charts
- Gold down but not out, ahead of NFP release
- Silver slides 6.5% lower as sellers dominate price action.
Q3 2019 Gold Forecast and Top Trading Opportunities
Gold Looking to Regain Upside Momentum
The recent sharp sell-off in the commodity space sent gold back to levels lows seen two weeks ago as market risk sentiment turned positive. US ADP jobs data was much stronger than expected Thursday while recent commentary around the US-China trade deal also gave risk assets a boost. Ahead today, the latest US Labor report – estimates around 160k –before Fed chair Powell speaks later in the session. This will be the last Fed speak before the blackout period ahead of the September 18 FOMC meeting.
While gold may be currently under pressure, it would not take too much to push prices higher again as the overall market backdrop – US-China trade fears, recession worries, lower US/global interest rates – remains the same. A look at the daily chart shows the CCI indicator selling off sharply and back at levels last seen in mid-May, as the market moves towards oversold territory, while there remains strong support between $1492/oz. and $1494/oz. In the short-term, gold will probably range trade before the US NFP report, but the fundamental background remains positive.
Gold Price Daily Chart (February – September 6, 2019)
IG Client Sentiment data show that 66.1% of retail traders are net-long of gold, a bearish contrarian indicator. However, recent daily and weekly positional changes give us a stronger bearish contrarian trading bias.
Silver Nears Supportive Zone
Silver’s sharp sell-off over the last 24-hours is bringing a supportive zone between $17.79/oz. and $18.05/oz. into view. This area is likely to remain supportive and if it holds will provide a springboard for a move higher. As with gold, the positive backdrop has not changed and any sell-off back towards $18.00/oz. should be monitored carefully, with $17.52/oz. providing the next level of support.
The gold/silver ratio is currently 82.00.
Silver Daily Price Chart (February – September 6, 2019)
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