Gold: Aggressive correction expected – BNY
|Bob Savage, Head of Markets Macro Strategy at BNY, notes a significant correction in Gold prices, driven by the nomination of Kevin Warsh as the next Fed chair, which has strengthened the U.S. Dollar. Gold fell sharply, with a 5.9% drop, while Silver and Platinum saw declines of over 10%. Despite this sell-off, Gold has gained approximately 17% in January, indicating stretched positioning prior to the correction.
Market correction in precious metals
"Gold and silver prices plunged on Friday as word of Kevin Warsh’s nomination as the next Federal Reserve chair boosted the U.S. dollar and triggered a sharp correction in precious metals. Gold fell as much as 5.9%, while silver and platinum dropped more than 10%, unwinding part of a powerful rally that had pushed technical indicators to extreme levels."
"Despite the sell-off, gold has still put on about 17% in January and silver 43%, underscoring how stretched positioning had become. Analysts said the news on Warsh provided a catalyst for a long-anticipated pullback after historically overbought conditions."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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