Market Nuggets
FOMC Minutes Point to Gold Bull Trend Moving Prices to $1,600: MKS PAMP Group
Gold prices are likely to remain supported with FOMC July meeting minutes pointing to more cuts in the short-term, says MKS PAMP Group. “The FOMC minutes reiterated the Fed’s willingness to act as appropriate and arguably both the domestic and international climates have deteriorated since the July 30 – 31 meeting, underpinning the calls for further cuts over the near-to-medium term. This should provide further broad support across the precious complex over the medium term, with the bull trend likely to remain intact and see gold consolidate for a test toward USD $1,600,” MKS writes. As of now, traders are buying the dips in gold, but a selloff towards $1,475 is not ruled out. “Fund inflows remain firm as participants look to pick up the metal on pullbacks, however this doesn’t rule out a test toward the firm support at USD $1,475 - $1,480 should fast money exit long positions on a move through the recent support around USD $1,492 - $1,495,” MKS adds.
By Anna Golubova of Kitco News; agolubova@kitco.com
Gold-Backed ETFs at 6-Year Highs, Metal Remains Sensitive to Powell: SP Angel
Thursday August 22, 2019 09:41
Gold prices will remain sensitive to Fed speak, especially when it comes to Federal Reserve Chair Jerome Powell’s speech at Jackson Hole on Friday, according to SP Angel. Even though Fed minutes from the July meeting reveal a more hawkish tone, the gold-backed ETF holdings are at the highest level in six years, analysts at SP Angel write, citing Bloomberg data. “While gold is likely to remain sensitive to Powell’s comments, inflows into exchange-traded funds hit 1,000t since holdings bottomed in 2016 following a prolonged unwind in the wake of the global financial crisis. Total known ETF holdings expanded to 2,424.9t on Wednesday, the highest since 2013 following a continued build-up in 2019, according to data compiled by Bloomberg.”
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