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Gold’s price broke down through $1,800 an ounce last week as the dollar continued strong.
On 8 July, the metal traded as low as $1,733 on the London Metal Exchange, the Financial Times reported, after peaking at $2,069 in March shortly after Russia invaded Ukraine.
Exchange-traded funds (ETFs) tracking gold saw investors pull out a net $1.7 billion in June in addition to the $3.1 billion withdrawn in May, the FT said.
The subtractions reduced the global value of gold-focused ETFs by 7 percent to $221.7 billion on 30 June, compared with a March high of $240 billion.
The funds’ assets remain 5.9 percent higher than at the end of last December.
The number of “long” gold contracts—bets that the price will rise in the near future—recently sank to its smallest since 2019, indicating that institutional investors see no rally in the short term.
Historically, gold has not been able to rally during a time when the U.S. Federal Reserve is tightening monetary policy, HSBC chief metals analyst James Steel told the FT.
The Fed is in the midst of a campaign to raise interest rates to, and perhaps beyond, 3 percent by the end of this year and also has stopped buying bonds.
“The economic climate of rising rates still argues for gold to go lower, which it is likely to do in the near to medium term,” Steel said.
Gold bugs may find encouragement as early as the end of this year, according to Joni Teves, metals strategist at UBS.
Gold price’s “consolidation and recovery are likely in the next six to 12 months as the Fed nears the end of its tightening cycle,” she said. The central bank then “is anticipated to shift back to easing in the second half of 2023.”
TREND FORECAST: Again, facts and data don’t count when the dealers are playing with a rigged deck.
Gold, the #1 safe-haven asset should be spiking during these times of socioeconomic and geopolitical turmoil.
For example, as economies are declining, inflation far above the central bank’s 2 percent rate and everyday prices are rising much higher than wages… gold, the most precious of precious metals, should be hitting new highs.
Why are gold prices going down rather than up? According to King World News, the evidence is clear that the game is rigged by the “legalized fraud” derivatives mob: See, “GOLD MARKET RIGGED: A Chart Says a Trillion+ Words.”