Gold prices are finally enjoying some relief today. The precious metal is currently strengthening. Yesterday, gold prices fell sharply as the US dollar strengthened alongside rising rates. As we wrote in our US dollar daily update, the buck has been rising thanks to an economic slowdown in all major regions except the United States. As both growth and inflation remain high, the Federal Reserve is more likely to raise interest rates (helping the dollar and hurting gold).
Looking at gold today, the precious metal is heading higher as the US dollar trades sideways. While US Treasury bond yields are rising today, this is having a limited impact on gold. As the US dollar continues to look overbought, we expect the dollar to give up more of its recent gains in the short-term. In the longer-term, gold remains in a bearish trend the dollar is likely to continue strengthening. Our short-term and medium-term outlook on gold is bearish.
After its most recent bottom around $1,303, gold is now above $1,309.
As gold prices weaken, we are now bearish on gold in the short-term. Note that gold is now trading within a normal range. This is based on various technical indicators on the daily chart.
As gold weakens, we are now bearish on the precious metal in the medium-term. The precious metal is trading within normal conditions. This is based on technical indicators on a weekly chart.