Last week, the gold market faced several headwinds and lacked supportive economic data, but gold demonstrated its resilience, slowly climbing despite volatility. Spot gold prices fluctuated throughout the week, eventually closing around $2,657 per ounce, achieving a 0.21% weekly gain.
Gold Market Volatility and Challenges
At the beginning of last week, spot gold opened near $2,652 per ounce, briefly dropping to $2,640. Although prices recovered slightly to $2,660 on Monday, gold retested the $2,640 support level several times in the following days, with a modest recovery by Wednesday. Despite facing bearish factors, gold showcased its safe-haven qualities and gradually regained upward momentum.
On Thursday, U.S. inflation data for September came in slightly higher than expected, causing short-term market fluctuations but pushing gold prices slightly higher. By Friday afternoon, gold reached a weekly high of $2,661 per ounce. Market participants are keeping a close eye on upcoming economic data, particularly U.S. retail sales figures and the European Central Bank's monetary policy decisions, as these events could impact gold prices in the near term.
Wall Street and Main Street Investor Sentiment
According to the weekly gold survey, Wall Street maintains a cautious outlook on gold's short-term performance, with limited upside potential. Only 47% of surveyed analysts expect gold prices to rise this week, while 13% anticipate a decline, and 40% remain neutral.
Meanwhile, optimism among retail investors has also diminished. Of the 157 retail traders surveyed, 56% expect gold prices to rise this week, marking the third consecutive weekly decline in bullish sentiment. Around 27% expect a decrease in gold prices, while 17% believe prices will remain flat.
Despite this, geopolitical tensions and concerns over economic uncertainty are expected to continue supporting gold's role as a safe-haven asset. The escalation of tensions in the Middle East, in particular, may drive investors toward gold, further boosting prices.
Gold's Future Outlook
Although gold has experienced some recent pullbacks, there remains potential for further gains in the coming weeks. In addition to geopolitical factors, investors are focusing on future adjustments to U.S. monetary policy, especially the possibility of rate cuts and how economic data will influence the Federal Reserve's decisions.
As global investors react to a stronger U.S. dollar and rising Treasury yields, gold still faces pressure. However, gold’s volatility is likely to increase, and its safe-haven status should continue to provide support.
In conclusion, despite the uncertainties surrounding the short-term outlook for gold, it remains a critical safe-haven asset in the context of a complex global economic and political environment. Investors should closely monitor upcoming economic data and global market trends to develop effective strategies.
