Gold: Near term prices could be poised for a consolidation lower – TD Securities

According to TD Securities analysts, the slight risk-off tone to start the morning has supported gold north of $1,500/oz mark, but recent dollar strength continues to constrain any excitement on the day.

Key Quotes

“The market is anxiously anticipating Fed Chair Powell's Jackson Hole speech on Friday, which could prove to be a disappointment for the market. Indeed, our rates strategists note that the Committee is divided on the outlook for rates and the impact of weak global growth and trade uncertainty on the US remains uncertain, while financial conditions have not tightened materially — which may embolden the Fed to stay the course and ultimately set markets up for a disappointment this week.”

“With gold positioning firmly skewed to long exposure, disappointing market expectations suggest prices could be poised for a consolidation lower in the near term, but any downside will likely be contained as a weakening economy, growing negative debt pile and dovish global central banks remain a strong platform for the yellow metal moving forward. As for the industrial precious metals, we estimate that CTAs remain sellers of platinum with downward momentum gaining strength.”

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