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 interest rates and very short-term inflation expectations fall, we are upgrading gold to bullish in the short-term. Gold is neither overbought nor oversold today and continues to trade within normal conditions. This is based on various technical indicators on the daily chart.
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.