Spot gold is attempting to stage a slight recovery ahead of the weekend, after being dealt a further blow by Thursday’s upward revisions to US GDP.
With the resilience of the world’s largest economy on show, the non-interest-bearing bullion was forced to move lower as markets raised their expectations for yet another Fed rate hike by July.
Gold bugs have also succumbed to the growing optimism for an imminent US debt deal, which dampened the allure of the traditional safe haven.
Amid such expectations, the precious metal is now on course for its third consecutive weekly decline – a losing streak not seen since September.
At the time of writing, gold is now testing its 100-day simple moving average (SMA) for immediate support. Should this crucial support fail, then the psychologically-important $1900 mark beckons.
Gold bugs may well continue languishing in the lead up to next month’s FOMC decision, likely to find it tough to sustain bullion’s recovery until peak US rates are well and truly in.
Gold bugs may be further encouraged to test resistance at the 50-day SMA around $1990 if US hiring momentum is truly waning.
2 June 12:53
Gold has been dragged below the psychologically-important $2,000 level this week due to optimism surrounding a US debt deal, while markets also ramped up bets of a Fed rate hike in June.
19 May 13:17
The longer that spot gold can keep its head above $2k amid sustained inflows into bullion-backed ETFs, the greater the chances of the precious metal revisiting its all-time high.
12 May 12:19
Gold posted a one-year high this week, enabled by market expectations that US rates have peaked, while persistent fears over US banking turmoil have bid up safe haven assets.
5 May 11:50
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