Opinion with Peter Hug
Gold Price Risk Is To The Upside
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
(Kitco News) - As per our comment last week, we remain constructive on gold and continue to see the risk to the bear camp. The first nudge was the lower PPI print, which created some speculation that the Fed may be less aggressive going forward. Then came yesterday’s suggestion that the U.S.-China trade war may be calming, with the U.S. invitation to the Chinese to continue dialogue. Interest rates still favor the dollar but any conciliation on the trade front should mitigate dollar flows from a safe-haven perspective. This is certainly not an all clear for gold, but it looks like the bottom has been established in August. The shorts will become increasingly restless should gold break above $1,212 and given the amount of short interest in the market, the exit door is growing smaller. We see small support at the $1,202 level.