Gold prices demonstrated resilience last week despite headwinds from a stronger U.S. dollar, higher bond yields and divergent central bank policies, according to analysis from the World Gold Council. The LBMA Gold Price PM declined 0.9% to $4,348 per ounce, with year-to-date performance standing at minus 0.4%, according to the source. Robust investment demand provided crucial support to the precious metal during the period.
Global gold-backed ETFs recorded accelerating inflows, with notable buying activity particularly evident during Asian trading hours. However, net long positions in COMEX gold futures declined during the same timeframe, presenting a mixed technical picture for the market. Central bank actions significantly impacted market sentiment.
The Federal Reserve delivered its first rate hike in three years, while the Bank of Japan also raised rates and the Bank of England maintained its policy stance unchanged. These divergent monetary policy moves, combined with renewed Middle East tensions raising concerns about potential oil supply disruptions, contributed to increased inflation pressures across several major economies. From a technical standpoint, gold has maintained support above its rising 55-day moving average positioned near $4,273 per ounce.
The World Gold Council identified $4,231 per ounce as an important support level, with initial resistance around $4,443 and the 200-day moving average near $4,541. A sustained break below $4,231 could expose gold to deeper losses, while a move above $4,541 may improve the near-term technical outlook. Market participants are closely monitoring several key developments including the outcome of Trump-Xi meetings, Federal Reserve officials' commentary and geopolitical developments at the UN General Assembly, all of which could influence gold's direction in coming sessions, according to the World Gold Council.
Source: scrapmonster.com