Gold price at risk of pullback to $4,215/oz as short-term momentum fades – World Gold Council

(Kitco News) – The Treasury Department and the Federal Reserve are sending mixed signals to the market, but recent events have been net negative for gold on balance, with prices retreating and bond yields on the rise across the globe, according to the World Gold Council (WGC). “The US Treasury ‘appears’ to want lower yields. The Fed wants lower inflation. Neither wants to break the economy, which may be the blunt way to achieve both,” WGC analysts wrote on Tuesday. “Of the two, the Fed has more firepower. So, when Fed chair Warsh struck a hawkish tone last Friday, markets lurched. A sharp jolt to the 2-year yield, reflecting expected tightening ahead, saw gold retreat below its 200dma.” The analysts noted that the release of still-hot U.S. inflation data and Warsh’s hawkish speech at the Jackson Hole Symposium boosted bets on near-term Fed hikes, increasing gold’s perceived opportunity cost and reducing its appeal. “Meanwhile, global gold ETF inflows continued, albeit at a slower pace; futures net longs rose, while options’ aggregated bullish positioning pulled back slightly.” Turning to the technical picture, WGC analysts said gold is at risk of a pullback to its 55-day average as short-term momentum turns lower and global bond yields continue to rise. “Gold strength has extended to just shy of resistance from the 50% retracement of the 2026 fall and May high at US$4,769/oz – US$4,774/oz and the subsequent sharp setback has seen the market fall back below its 200-day average to leave the market in what may be a developing sideways range,” they wrote. “With daily RSI momentum completing a top […] and with net long positioning having risen sharply we see scope for a deeper setback in this range, especially in light of the rise we are seeing globally for bond yields.” “Support is seen initially at the mid-August low at US$4,311/oz and then more importantly at the rising 55-day average, currently seen at US$4,215/oz,” the analysts said. “Our bias would be to look for a floor here again. Resistance is seen initially at the 13-day exponential average at US$4,474/oz, then the 200-day average, now seen at US$4,530/oz. [A move back] above this latter level would be seen to turn the near-term trend higher again, with resistance then seen back at the US$4,696/oz recent high, then US$4,769/oz – US$4,774/oz.” See live precious metals prices for gold, silver, platinum and palladium — in USD, CAD and 12 more currencies. Ernest Hoffman Ernest Hoffman is a Crypto and Market Reporter for Kitco News. He has over 15 years of experience as a writer, editor, broadcaster and producer for media, educational and cultural organizations. Ernest began working in market news in 2007, establishing the broadcast division of CEP News in Montreal, Canada, where he developed the fastest web-based audio news service in the world and produced economic news videos in partnership with MSN and the TMX. He has a Bachelor's degree Specialization in Journalism from Concordia University. You can reach Ernest at 1-514-670-1339. Tags: gold price forecast Federal Reserve Treasury Department 30-year Treasury yield 10-year Treasury yield World Gold Council Share 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.