Monday, 4 February 2019 21:59 WIB | GOLD CORNER |Gold OutlookGold Corner
Wall Street and Main Street look for gold to keep climbing this week, according to the Kitco News gold survey.
Many traders and analysts cited a dovish Federal Open Market Committee after a policy meeting this week, in which officials indicated they are pausing in the monetary-tightening cycle while awaiting more economic data. This tends to undermine the U.S. dollar, which helps gold. It also limits the so-called œopportunity cost of holding non-interest-yielding assets such as precious metals.
Wall Street voters remained bullish even in the aftermath of a strong U.S. jobs report on Friday that normally might hurt sentiment by rekindling rate-hike worries. The Labor Department said U.S. nonfarm payrolls rose by 304,000 in January.
Sixteen market professionals took part in the Wall Street survey. There were 10 votes, or 63%, calling for higher prices. Two respondents, or 13%, said lower, while four, or 25%, said sideways.
Meanwhile, 561 respondents took part in an online Main Street poll. A total of 357 voters, or 64%, called for gold to rise. Another 135, or 24%, predicted gold would fall. The remaining 69 voters, or 12%, see a sideways market.
In the last survey, 72% of Wall Street and 47% of Main Street was bullish on gold.
Bob Haberkorn, senior commodities broker with RJO Futures, looks for gold to keep rising on ideas the Federal Reserve has paused its rate-hiking cycle. Previously, rate hikes had limited gold™s upside for the last two years, Haberkorn said.
œHe [Fed Chair Jerome Powell] said the Fed will have patience, Haberkorn said. œThey will be in no hurry to raise rates again¦.The dollar is getting softer [as a result]. That will help gold out.
Colin Cieszynski, chief market strategist at SIA Wealth Management, also said he is bullish. œWith the Fed apparently pausing its rate-hike program, U.S. Treasury yields have come down and so has the U.S. dollar, removing a headwind from gold, he said. œMeanwhile, ongoing political and/or economic turmoil in Venezuela, Europe, China and elsewhere may continue investor interest in safe-haven plays like gold.
Peter Hug, global trading director with Kitco Metals, said he remains œconstructive, but adds that œwith the Chinese holiday this week, we may see a more balanced tone to the market.
Meanwhile, Ole Hansen, head of commodity strategy at Saxo Bank, said it™s time for gold to consolidate. He offered a œshort-term bearish view targeting $1,300.
George Gero, managing director with RBC Wealth Management, said he looks for range-bound prices next week as Chinese trade and tariff talks continue. Otherwise, œmostly everything [is] priced in for now, he adds.