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RJO's Haberkorn: Dovish Fed, Geopolitical Worries Supportive For Gold

Kitco News

A number of factors could be supportive for gold in the near future, says Bob Haberkorn, senior commodities broker with RJO Futures. “With geopolitical unknowns, such as [trade talks with] China and the U.S. shutdown, you’ll see gold a little higher,” he says. “The main driver is the Fed backing off on rate hikes.” Federal Reserve policymakers are scheduled to meet next week, and they have been sounding a more dovish tone lately, Haberkorn says. This is helping gold so far Friday, he adds. As of 8:46 a.m. EST, spot gold was $8.60 higher to $1,289.20 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

FXTM: Market Concerns Could Inspire Gold Bulls

Friday January 25, 2019 08:54

Gold has moved little in the last week but could draw support from a number of worries in financial markets, says Lukman Otunuga, research analyst at FXTM. The metal has been around $1,280 to $1,285 for much of the week, and bullion is finding $1,300 to be tough resistance, he says. Investors are watching US-China trade talks, with five weeks remaining before the U.S. could hike tariffs on $200 billion worth of Chinese goods, the analyst says. “A statement regarding the ongoing negotiations is expected next week; that may potentially serve as the next marker in global risk sentiment,” Otunuga says. “Recent communication from policymakers has added to the narrative of 2019’s expected slower growth, evidenced by the IMF [International Monetary Fund] lowering its global growth outlook for the second time in three months, China’s cooling growth in Q4 of 2018, and Germany’s January PMI [purchasing managers index] showing its first contraction in four years. Such concerns have the ability to support gold prices by instilling bulls with enough inspiration to challenge $1,295 and $1,300, respectively.” A move towards $1,295 will be on the cards in the near term if bulls are able to secure a daily close back above $1,286, the analyst adds. As of 8:37 a.m. EST, spot gold was up $7 to $1,287.60 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

TDS: Little Activity In Gold, Silver From ‘Trend Followers’

Friday January 25, 2019 08:54

TD Securities looks for little activity in gold and silver in the near future from “systematic trend followers,” adding that they likely only hold “marginal” gold and silver positions. “And, as some money managers are reluctant to meaningfully add risk ahead of next week's FOMC [Federal Open Market Committee] and trade meetings, we suspect that the recent flows into gold and volatility funds are unlikely to unwind in the very near term, suggesting a few quiet sessions ahead,” TDS says. “That being said, it is worth reiterating that the recent recovery in risk assets has also coincided with Fed hikes being priced out. We think that the market will likely see at least one hike priced back into the market, which suggests that gold prices are unlikely to break the $1,300/oz just yet.”

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