Wall St., Main St. Both Split On Gold Prices
(Kitco News)- WallStreet and Main Street alike are nearly evenly split on whether gold pricesshave bottomed and will rise in the next week, based on the weekly Kitco Newsgold survey.
Seventeenmarket professionals took part in the Wall Street survey. Seven respondents, or41%, called for higher prices, while six, or 35%, said lower. Four respondents,or 25%, predicted a sideways market.
Meanwhile,617 voters responded in an online Main Street survey. A total of 261respondents, or 42%, predicted that gold prices will be lower in a week.Another 252 voters, or 41%, said gold will rise, while 104, or 17%, see asideways market.
Wall Street
Bullish
Bearish 
Neutral VS
Main Street
Bullish Bearish Neutral Forthe trading week now winding down, 50% of Wall Street voters and 51% of MainStreet respondents were bearish. As of 11:09 a.m. EDT, Comex December gold wasdown 0.6% for the week so far to $1,233.20 an ounce.
KenMorrison, editor of the newsletter Morrison on the Markets, looks for gold toattempt to reclaim the $1,240 area. Despite headwinds such as lingering U.S.dollar strength and expectations for more U.S. rate hikes, gold has “held itsground” above $1,200 an ounce so far, he pointed out.
“Withsentiment near extreme bearishness and managed-money funds near or at a recordnet short, I expect December gold will manage to trade to $1,240 again withinthe week,” Morrison concluded.
GeorgeGero, managing director with RBC Wealth Management, said if gold can holdnearby chart support until Aug. 1 when the rollover out of the August futuresshould be over, “we could see a rally and shorts covering.” Thus, he looks fora “small up” next week.
SeanLusk, director of commercial hedging Walsh Trading, looks for gold to bounce,with some buying starting to kick in ahead of the historically strong autumnseason, as well as potential bargain hunting after gold’s recent weakness. Healso pointed out that data this week shows that Chinese imports from Hong Kongrose sharply last month.
“Ijust think prices are too low,” Lusk said. “There are still worries in themarkets. Things aren’t as rosy as they seem.”
AKitco reader from Utah named Lynn is also bullish.
“Goldshould head higher next week, because it has finished seven waves down,according to The Economic Time Equation, and [held] the Fibonacci level of$1,209 or close enough to it, which is a 50% retracement of the move from thebottom to the top of the previous bull run,” Lynn said.
KevinGrady, president of Phoenix Futures and Options, remains bearish.
“Althoughwe are seeing some ETF buying, I believe gold has not found its floor,” Gradysaid. “I believe a test of the $1,200 support level is imminent.”
CharlieNedoss, senior market strategist with LaSalle Futures Group, said he looks forgold to test the lower end of its recent range while the U.S. dollar tests theupper end. Jim Wyckoff, senior technical analyst for Kitco, sees gold sidewaysto lower since the technical charts are still bearish.
RichardBaker, editor of the Eureka Miner Report, sees gold weaker, citing gold’srecent fall being in lock step with the Chinese yuan.
“Thistight relation between gold and the Chinese currency began with escalatingU.S.-China trade tensions in late March; both gold and [the] yuan haveplummeted in value since,” Baker said. “Today's yuan above 6.8 USD/CNY isstatistically consistent with $1,213 gold bounded by $1,228 above and $1,197below. A retest of $1,210 is now likely suggesting more pain may be on the wayif the correlation holds.”
OleHansen, head of commodity strategy at Saxo Bank, said he is neutral on goldnext week, commenting that the market is directionless as it is stuck in achannel between $1,210 and $1,240.
“Thisis not the time of the year to make big decisions on direction,” Hansen said.“Traders are more concerned with getting their kids to the beach.”
ColinCieszynski, chief market strategist at SIA Wealth Management, also said he isneutral on gold in the near term.
“Iam close to being outright bullish on gold, but I will remain a little morecautious because I don’t know if there is one more washout in the marketplace,”he said.
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.