Gold remains weak, and fell sharply last Friday. This morning, the precious metal is up slightly. Despite the disappointment that followed the release of the House and Senate draft tax bills, gold prices have been mostly trading in a range between $1,270 and $1,280. The outlook for inflation continues to improve thanks to rising prices of commodities such as crude oil and copper. We are lowering our short-term outlook on gold to bearish as a result. 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 $1,276.
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.