Gold has finally broken out of the $10 range it has been stuck in for the last 11 trading sessions. Previously, the precious metal was bouncing between $1,270 and $1,280. While the dollar has yet to significantly weaken, gold is benefiting from falling real rates. As both bond yields and expected inflation fall in the very short-term, gold is rising as a result. Later today, we will upgrade our short-term outlook on gold to bullish, while maintaining our medium-term outlook at neutral. Looking at technical indicators, gold is trading within normal conditions and is neither overbought nor oversold.
After its most recent top above $1,300, gold is now above $1,283.
As gold continues to trade sideways, we are upgrading the precious metal to neutral in the medium-term. While gold was looking overbought earlier in October, the precious metal is now trading within normal conditions. This is based on technical indicators on a weekly chart.