Wall, Main St. Bullish On Gold Prices
(Kitco News) - WallStreet and Main Street are both heavily bullish on the near-term direction ofgold prices, based on the Kitco News weekly gold survey.
Thetraders and analysts who take part in the Wall Street poll cite mostlytechnical-chart factors - in particular, gold’s ability to hold around the200-day moving average and the psychologically important $1,300-an-ounce levelduring a recent price pullback. They also suggest the U.S. dollar’s recentstrength may be waning.
Nineteenmarket professionals took part in the survey. Fifteen of the respondents, or 79%,called for gold prices to rise over the next week. There were two votes each,or 11%, calling for gold to fall or be sideways.
Meanwhile,a larger-than-average 2,491 voters responded in an online Main Street survey. Atotal of 2,207 respondents, or 89%, predicted that gold prices would be higherin a week. Another 185 voters, or 7%, said gold will fall, while 99, or 4%, seea sideways market.
Wall Street
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Bullish Bearish Neutral Forthe trading week now winding down, 67% of Wall Street voters and 69% of MainStreet respondents called for gold to rise. As of 11: a.m. EDT, they wereright, as Comex June gold was up 0.6% for the week so far to $1,322.60 anounce.
“Gold has weathered the storm from the strongU.S. dollar and held above the 200-day moving average,” said Adam Button, managing director of ForexLive. “That's a positive sign for the week ahead.”
Added Jim Wyckoff, seniortechnical analyst with Kitco: “The $1,300 level has held to suggest a near-termmarket bottom is in place.”
MarkLeibovit, editor of the VR Gold Letter, looks for more of a rally in gold dueto a likely pullback in the U.S. dollar. However, he added, the “dollar pullback may only be temporary,in my view.”
Phil Flynn,senior market analyst with at Price Futures Group, is also bullish on gold,commenting that the metal appears to have established a technical bottom aftera “rough week,” with recent pressure prompted by U.S. dollar strength.
“It looks likewe’ve turned the corner, perhaps because of geopolitical risks and inflationdata that not as hot as people thought,” Flynn said. “It allows gold to go upbecause they [traders] as not as fearful of the Fed raising interest rates.”
Sean Lusk, director of commercial hedging with Walsh Trading, also citedgold’s ability to avoid follow-through selling as the metal recently approachedthe $1,300 level.
“I think the trade would rather err to the long side rather than theshort,” he said. “The path of least resistance is higher, not lower.”
Meanwhile,Ralph Preston, principal with Heritage West Financial, is among those who lookfor gold to pull back again. “We got a little pop higher,” he said, but afterthe bounce from the recent lows, he now looks for the metal to run into chartresistance around the $1,344 area.
Robin Bhar, metalsanalyst at Societe Generale, sees gold trading mostly sideways. “For themoment, geopolitical tensions are being offset by the dollar,” Bhar commented.
By Allen Sykora
For Kitco News
Follow @AllenSykora
asykora@kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.