The sell-off momentum at the end of last week combined with uncertainty about interest rate cuts and a lack of important news could push gold prices down. According to a survey by Kitco, sentiment towards precious metals has deteriorated among Wall Street analysts, with only three forecasting higher prices and eight predicting a decline.
Despite recent selling pressure, there are still positive factors supporting gold, such as increased demand from central banks and financial institutions. UBS bank raised its forecast for gold to reach $2,600 an ounce by the end of the year and recommends buying when the price is at $2,300 or below.
However, some analysts see downside risks. James Stanley, senior market strategist at Forex, believes the market is experiencing a non-trend period. He says that while gold prices rose above $2,400 per ounce last week before pulling back to close to $2,330, this trend may not continue in the near future.
Colin Cieszynski, Chief Market Strategist at SIA Wealth Management, agrees that this will be a quiet trading week due to the holiday season in the US and the lack of major events. However, he believes that gold prices have room for recovery if investor sentiment improves.
In contrast, Main Street investors are more optimistic about precious metals than their Wall Street counterparts. This week is expected to be quiet in terms of economic news, with only a few notable announcements such as the US preliminary first quarter GDP and personal income and spending reports. Despite this lack of significant news events during this week, Main Street investors are more likely to view gold positively than Wall Street analysts.