XAU/USD

Gold and silver have been on the rise in the last couple of days, recovering from weakness earlier in the week. Once again, gold has risen alongside equity markets, suggesting the recovery is not entirely driven by haven flows amid uncertainty surrounding the upcoming French snap elections, which appears to have only impacted the local stock and bond, as well as regional, markets.

Soft inflation figures from Canada and a poll of economists backing a June Fed cut sent gold higher on Wednesday, as traders refreshed their dovish bets. Crude oil has also faltered once more at a key resistance area.

Gold is currently down -1.8% in January, and I see further downside potential due to the growing case for a stronger US dollar. But that doesn’t mean gold will fall against everything by the same degree, if at all.

January is usually a decent month for gold prices looking at this seasonality chart. But with gold rallying each month in Q4 and failing to hold onto gains above the prior record high, has it peaked too soon to expect another strong month?

Gold just posted its highest monthly close on record, and now trades less than $40 from its record high set in May. With seasonality on its side, I suspect another crack at the record high could be in order. Although it does run the risk of a shakeout around the milestone level.

It seems the dollar correction is finally underway, with the US dollar index suffering its worst single day in one year. And it shows the potential for further losses, even if it has found support for now. Gold also shows the potential to have another crack at $2000.

Gold prices suffered their worst day in 8 weeks on Tuesday with spot prices falling below the 200-day EMA and closing on the key $1900 level. But with gold lower against a basket of currencies, it shows gold is weaker and it's not just a case of a stronger USD or yields.

Despite competing with the strength of the dollar, gold has been trading higher against all other major currencies since its low in August. This could suggest that gold is acting as a safe haven, even if it is not immediately obvious from the XAU/USD chart.

Our longer-term gold forecast remains positive, owing to the fact global monetary policy can only start to loosen from here

Gold has continued to hit the headlines as it teases investors with a record high. But that doesn’t mean gains will be plain sailing from here, even if we remain bullish this year overall.

My gold outlook remains positive because the Fed is likely to start cutting rates by as early as September.

Tumbling bank stocks and a sharp slide in crude oil prices are highlighting financial stability and recession risks, underscoring our bullish silver outlook.

The gold outlook has improved because of a drop in US dollar and bond yields, following the release of more disappointing US data.

While the metal may well extend its drop in the short-term, my longer-term gold outlook remains positive. I therefore envisage a rise to a new record high soon.

Today’s US inflation report could be the difference between a 25bp Fed hike or pause at their May meeting, making it a key data point to watch.

Renewed weakness in bond yields and US dollar, thanks to soft US data, has brightened the gold outlook

Following tense weekend talks, UBS has agreed to purchase Credit Suisse by the end of the year for Fr 3 billion ($4.5 billion).