Gold: Significant upside – ANZ

FXStreet Team FXStreet

Analysts at ANZ Research see significant upside for the gold price, despite it having rallied more than 8% this year on the weakening macro backdrop. XAU/USD is trading at 1585.80.

Key quotes

“Even with inflation expectations likely to drop sharply in coming months, lower bond yields and a weaker USD should see gold’s valuation push higher. In fact, we see significant upside to gold prices if the economic turmoil continues to increase.”

“Technically it looks stable. The Relative Strength Index (RSI) currently sits at 54, well below overbought territory of 70.”

“We believe the fundamentals should be supportive enough to limit the losses in any technically based sell-off.

“We have upgraded our price forecast, with the year-end target rising to USD1,750/oz. However, we see a high probability of USD2,000/oz in Q2. This will depend on the extent of the pandemic and its economic implications.”

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

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