- At the end of trading last week, the gold price rose to the resistance level of $2088 per ounce, starting from the level of $2038 per ounce in the same trading session.
- This is the best daily performance for the gold price in three months.
- According to the trading, the gold price has moved to achieve its second consecutive weekly gain, supported by the decline in the US dollar price and the decline in Treasury yields. This was amid weak US economic data.
February data continued to show a decline in the US manufacturing sector.
Consumer surveys conducted by the University of Michigan indicated another weakness. In addition, recent economic data revealed that annual inflation growth in the United States for January was the smallest in nearly three years. At the same time, New York Federal Reserve President John Williams recently expressed his expectations of cutting the US interest rate later this year, stressing the decline in inflation and the strong economy, indicating that current economic conditions do not require raising the interest rate.
On the other hand, this earnings season gave investors enough reasons to pump money into stock markets even as traders became increasingly concerned about the economy and the timing of US interest rate cuts by the Federal Reserve. The results of the last quarter of 2023 indicated the continued strength of companies despite the anxiety. Balance sheets held up, big tech stocks remained supported, and operating margins were steady as companies cut costs. Finally, Corporate America finished the year surprisingly strong.
With the release of results from nearly all US companies listed on the S&P 500, fourth-quarter earnings appear excellent. Growth reached around 8%, compared to expectations of a 1.2% increase before the season began. These earnings beats helped offset the uncertainty in the overall economy. Over the past couple of months, traders have backed away from bets on when the Federal Reserve would start cutting US interest rates. The fading hopes of policy easing didn't do much to aid stocks at the beginning of the year, with the focus on earnings season. Approximately 76% of companies were surprised to the upside—exceeding the ten-year average of 74%, according to data compiled by Bloomberg Intelligence, prompting Wall Street markets to snatch up stocks confidently and swiftly.
Among the highlights of this season was Nvidia Corp's earnings. Recently, the company surpassed expectations and provided strong future guidance, helping alleviate concerns about potential near-term slowdowns in artificial intelligence growth.
Overall, the strong results achieved by US companies have not extended globally. Profits in Europe lagged behind American companies by the largest margin in three years, according to analysts at JPMorgan Chase & Co. and their peers, estimating that earnings for the STOXX 600 index dropped by 11% in the fourth quarter compared to an 8% increase in the United States. This is largely attributed to the impact of struggling regional economies – with both Germany and Britain entering recession – and the disappointing recovery in China, which is a significant market for mining companies, automakers, and luxury goods firms in Europe.
Gold Price Forecast and Analysis Today:
According to trading on the contract for difference (CFD) that tracks the benchmark market for this commodity, the gold price has risen by 1% since the beginning of 2024. According to global macroeconomic models and analyst expectations, gold is expected to trade at $2100 per ounce by the end of this quarter. Looking ahead, we expect it to trade at 2134.44 in 12 months. As we mentioned before on the direct trading recommendations page, buy gold from every downward level, and the psychological level of $2,000 per ounce will remain the barrier between the two trends. Finally, economic data results and statements by central bank officials will have a strong and direct reaction to the performance of the gold price.
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