Facts
- Gold has come under pressure from a strong dollar but recessionary readings could weaken the USD
- US labor market reading (JOLTS) and Philly Fed on today's calendar
- The overall trend among precious metals remains upward
Recommendation
- Recommendation: Long position on GOLD at market price
- Targets: 2015, 2050
- Stop: 1930
Opinion
The pullback in gold did not stop at the 38.2 Fibonacci retracement of the March 10 upward wave, when bullion began to gain on the wave of the banking crisis, but the price is still very close to this level.The relative strength index (RSI) fell below 30 points, signaling an oversold condition. It is at this level that demand has become active in recent months. Recent macro data from the U.S. economy came out rather mixed, but the overall trend points to an economic slowdown, as discussed recently by Loretta Mester of the Cleveland Fed, among others.
The regional NY Empire State reading on Monday was quite a disappointment, and today the markets will turn their attention to another regional industrial benchmark - the Philly Fed. The JOLTS reading will also be closely watched by markets. A weakening US labor market may support gold - as may further 'recessionary' weakness in US manufacturing. Looking historically, bullion has done well during recessions by which demand may still support gold in key price zones. We recommend taking a long position on gold, with a defensive stop loss order, around $1930 - a pullback below this level may suggest that bears want to test the 61.8 Fibo retracement at $1912 level.
Source: xStation5
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- XTB data
- A person preparing a recommendation
- Eryk Szmyd
- Other persons participating in preparation of recommendation
- A name of entity supervising
- Date and hour of preparation of recommendation
- 5/18/2023 08:37
- Date and hour of publication of recommendation
- 5/18/2023 08:52
- A group of addressees of the recommendation
- XTB customers and potential customers
- Relevant information sources
- xStation5
- A time horizon for the recommendation
- Till reaching target or stop loss price
- Projected date of actualization
- Unspecified
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