Wall Street leans slightly bearish and Main Street slightly bullish in the weekly Kitco News gold survey.
Neither the bulls nor the bears had an outright majority in either survey, however. The Wall Street bulls figure gold is due for a corrective bounce higher, while the bears look for the downward momentum to continue due to technical-chart damage and recently stronger equities.
Fifteen market professionals took part in the Wall Street survey. Six voters, or 40%, look for gold to continue its recent slide. Five voters, or 33%, called for higher prices, while the remaining four, or 27%, expect prices to be sideways or were neutral.
Meanwhile, 522 respondents took part in an online Main Street poll. A total of 242 voters, or 46%, called for gold to rise. Another 206, or 39%, predicted gold would fall. The remaining 74 voters, or 14%, saw a sideways market.
Comex June gold futures were trading down 1.3% for the week so far at $1,277.80 an ounce.
· “I think you will see more downside just because of the fact that equities are so strong now,” said Bob Haberkorn, senior commodities broker with RJO Futures. “With equities [up] there, it will be hard for gold to stage a rally.”
· Charlie Nedoss, senior market strategist with LaSalle Futures Group, looks for June gold to edge lower still toward the 200-day moving average around $1,266.90. However, he added, the market may find support there and bounce, particularly since an upside breakout occurred from around here late last year.
“I think we still come down and test the 200-day average,” Nedoss said. “There is enough momentum to the downside. The dollar [index] keeps testing that 97 level.”
· Adrian Day, chairman and chief executive officer of Adrian Day Asset Management, looks for gold to bounce after becoming “oversold” during the recent downdraft.
“On a longer-term basis, the dollar needs to decline for gold to move meaningfully higher and on a sustained basis,” Day added.
· Afshin Nabavi, head of trading at trading house MKS (Switzerland) SA, also looks for gold to stage a recovery after some bulls exited in response to recent U.S. dollar strength.
“[The] $1,270 [area] held rather well,” he said. “I wouldn’t be surprised if next week, when everyone is back on Tuesday [following Easter weekend], we see a move back up again if there are no fresh surprises in the market.”
· Mark Leibovit, editor of the VR Gold Letter, said he is bullish on gold overall, but for now is “neutral until the summer cyclical lows are posted.”
· Sean Lusk, director of commercial hedging with Walsh Trading, looks for a steady market next week. Technically, a move above $1,282portends further strength, he said. But if prices remain below, they could test the 200-day moving average the around $1,267 neighborhood. Keys will be whether equities remain elevated and the next move in the U.S. dollar, he added.
· Gold will break out of slump and test 2018 highs: Standard Chartered’s precious metals expert
One of Wall Street’s top metals expects predicts gold will breakout this year.
With gold prices sinking to 2019′s lowest level last Thursday, Standard Chartered’s Suki Cooper believes they’re closing in on oversold territory.
One of her key assumptions: The Federal Reserve keeps its interest rate hike policy on hold through next year. It’s a scenario, Cooper suggests, the Street hasn’t been giving serious thought to yet.
“The Fed will be on hold in 2019 [and] 2020 as it prepares its tools for the next downturn which is likely to come in 2021,” the firm’s executive director of precious metals research told CNBC’s “Futures Now. ”
Investors typically view gold as safe haven asset when economic growth sputters. Plus, Cooper notes gold follows a historical pattern that leads to higher prices when the Fed Britain was originally due to leave the European Union on March 29, but that deadline was pushed back to April 12 and then again to Oct. 31 as May failed to break an impasse in parliament on the terms of Brexit.puts the breaks on a hiking cycle and even went on to cut rates.
“Investor positioning and prices actually were range bound for a short while before they lifted higher say six months later,” Cooper said. “The trend that we’re seeing at the moment isn’t dissimilar to what we’ve seen in the past.”
Cooper suggests central bank buying and increasing demand from China and India will also likely to support gold prices at higher levels versus2018.
“We think that upside is more likely to materialize as the year unfolds,” she said. “In Q4, we’re expecting prices to average $1325 because that’s when we expect the dollar to weaken and yields to start to ease as well.”
She expects the yellow metal to test last year’s closing high of $1362 an ounce in the final three months of the year. And, her forecast gets even more bullish by 2020.
“We actually think gold prices are more likely to break upside further in 2020 averaging $1375 next year,” said Cooper.
Reference: CNBC, Kitco
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