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Gold price above $2K can be sustained, but be cautious in near-term: TD Securities

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(Kitco News) Gold can trade sustainably above $2,000 an ounce, but the near-term signals are pointing to some consolidation in the near-term, according to TD Securities. “Gold futures hit $2000/oz overnight, proving to be a heavy resistance for the time being as prices promptly fell $50/oz. While we do believe a run above $2000/oz can be sustained, we remain cautious in the near-term as the rally has outpaced the real rate decline and positioning has become more stretched recently, suggesting a period of consolidation could be in the cards,” TD Securities commodity strategists write. Precious metals saw some pressure coming from a pause in inflation expectations, the strategists add. “For precious metals bulls, the risk at this week's FOMC relates to the duration adjustment required as auction sizes are set to significantly increase, which could generate a supply-demand mismatch and pressure long end rates should they keep the composition unchanged.”

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